By Ryan McDermott

New Year’s resolutions aren’t just for wellness habits. For trustees, this is a great time to refresh your understanding of your fiduciary duties. Ideally, you’ll stick with them longer than I will stick with my resolution to exercise more. If trustees approach their obligations the way I approach the gym, they could be facing a breach of duty issue by the middle of March.

The Florida Trust Code provides guidance; trustees owe beneficiaries a duty of loyalty (Fla. Stat. § 736.0802), impartiality (Fla. Stat. § 736.0803), and to administer the trust with prudence (Fla. Stat. § 736.0804).  

It is always important to follow the text of the specific trust instrument in addition to these statutes, because often times the trust will provide more specific guidance to a trustee and confer certain authority that might be useful in practice. For example, a trust instrument may give the trustee the ability to engage in self-dealing. This might otherwise be a breach of the duty of loyalty, but the settlor may want to allow self dealing by the trustee under certain circumstances and therefore expressly authorize it.  

By way of another example, a trust may pass assets to multiple beneficiaries to be held in further trust, with the trustee having discretion to make distributions to them. A trustee would have a duty of impartiality between beneficiaries, however a trust instrument can expressly authorize a trustee to favor one beneficiary over another. A settlor may want their trust drafted in order to anticipate a beneficiary having greater needs or clarifying what the settlor wishes to provide for.  

Additionally, a trust may expressly authorize the trustee to hold an unproductive asset, which might otherwise constitute a breach of the duty to administer the trust prudently. For example, a settlor may wish for the trust to retain a large piece of undeveloped real property to pass on to beneficiaries.

Trustees have the duty to maintain books and records accounting for trust assets and must provide an accounting to qualified beneficiaries annually. Should a trustee ever be removed, the former trustee has a duty under Florida law to provide the successor trustee the books and records that the former trustee kept. The duty to administer trust assets with prudence most likely requires the trustee to ensure a certain level of diversification in investments. It may be a breach of duty to have trust assets overly invested in one asset class, exposing the trust to greater risk and perhaps a less-than-optimal return on investment.  

Kick off 2026 by reviewing your trust instrument and recommitting to your fiduciary obligations. A well-kept resolution will keep you in financial shape long after January fades (even after you've given up on going to the gym).

By Leah Crespi

Is there a bag of old clothes sitting in the back of your closet? Be honest. A closet cleanout at the start of the year lets you take stock of what still fits, keep the pieces that suit your life today, and finally part ways with those increasingly snug jeans you've had since college. Like your wardrobe, your will should be tailored to meet your needs and updated as those needs change.

The new year is much more than a symbolic milestone; it is a practical checkpoint to ensure that the documents meant to protect you and your loved ones still reflect your life as it is today, not as it was when you first signed them. 

A thorough review at the start of each year generally involves:

Even if your financial status has not drastically changed, your personal life may have. We encourage our clients to reach out whenever they experience major life events including marriage, divorce, births, deaths, or even moving to a different state. For example, what if you divorced your spouse but your beneficiary designations still name them? Or perhaps you remarry but never get to updating your plan to properly provide for your spouse like you intend to.  

Of course, finances also play a central role in your estate plan. Maybe nothing has changed in your day-to-day cash flow but behind the scenes your net worth has increased significantly. Perhaps you inherited a substantial sum of money or sold your business and now your net worth exceeds the Federal Estate Exemption. These significant changes can open the door to strategies that weren’t necessary before like charitable planning or lifetime gifting. Without updating your estate plan, you may miss out on opportunities to reduce estate taxes, protect your assets, and ensure that your wealth is distributed according to your wishes.  

A review of your estate plan annually does not need to be overwhelming or time consuming. We can assist you in identifying efficient strategies that keep your plan aligned with your long-term goals and objectives. Whether your circumstances have shifted slightly or dramatically, a fresh look each year ensures that your plan continues to benefit you and the people you care about. 

By Leah Foertsch

When first dipping their toes into estate planning, most clients are concerned with the immediate – if I find myself incapacitated or if I pass unexpectedly.  While our team will always help you plan for those urgent concerns, we often focus on what comes next — do you want to provide for your grandchildren or future generations?  Are you concerned with your family legacy?  Will your charitable endeavors outlive you?   

If you are the client who says “I’m not worried about it, I’ll be dead,” we urge you to think twice.  No matter what you are leaving behind – the family homestead, retirement assets, or enormous wealth, planning is essential  to ensure those assets continue to serve your family. Two of the tools available to us include purpose trusts and dynasty trusts.  

A purpose trust –  popularized by the planning undertaken by the Patagonia founders – can act as a mechanism which can allow your business to continue to operate profitably, within guidelines, and then fuel the growth of your family foundation or otherwise further your philanthropic aims.  In engaging in this type of planning, continued employment can be provided for family members by the implementation governing bodies.  This type of planning provides a good mechanism to catalyze your family values and ensure the family is aligned in its purpose and vision. 

A dynasty trust is established to provide a benefit beyond the immediate generations.  With the federal estate tax exemption of $15m in 2026 and then annually increased, the trust can immediately be funded with the exemption amount. The transfer into the irrevocable trust is complete, so the assets are owned by the trust and not the grantor or the beneficiaries, excluding the assets from each of their estates and providing asset protection. Although the assets will be outside of the grantor’s estate, the trust can be set up as a grantor trust for income tax purposes; in that way, the grantor would pay the income tax on trust earnings and the assets in the trust would then grow unhampered by periodic income tax payments; and the grantor would continue to “spend down” his estate by paying the income tax. A threshold inquiry is whether your state allows the creation of a dynasty trust, having eliminated the Rule Against Perpetuities.  Of importance with this technique, is the stewardship of legacy where the grantor can essentially provide operational guidelines for the next generations. 

The New Year serves as an opportunity to finally turn our long-term goals into reality (and to shed those holiday pounds from all the pies, cakes, and delicious treats we enjoyed). 

Fitness is an investment — time and commitment are required to reap the dividends. Just like your new fitness routine, creating and achieving your financial goals requires your time and your personal commitment to success. We tell ourselves we are going to spend less and save more, but nowadays those targeted ads know us so well!  

Whether the goal is saving for retirement, increasing current revenue, or creating a legacy for your family, the first step is identification. When your feet are strapped into the Peloton, it is easy to identify your goals — I want to lose X number of pounds, I want to exercise at least X numbers of days per week.  

The financial goals we set for ourselves can be much more difficult to identify and even more challenging to achieve because the actions necessary for success aren’t as obvious as spending twenty minutes on the treadmill.  

Fear not! We are here to provide you with a guiding framework to evaluate your financial fitness, set New Year’s goals, and achieve success. Evaluating your financial fitness isn’t just about analyzing the dollars in versus the dollars out, it’s also about considering your long-term vision. 

The New Year is a great opportunity to review your insurance policies and ensure that the policies still accomplish your goals. Does your life insurance provide enough protection for your family? Or perhaps, are you now paying premiums for a policy amount greater than your family’s current needs?  

The same questions apply for all types of insurance. Has the value increased or decreased enough to warrant reevaluation? What is the current value? Is it time for an appraisal? 

Certainly, no one likes paying for insurance and nobody wants to pay for more insurance than they need.   

Have you met lately with your advisors to ensure that your retirement and gifting goals align with your current habits? If not, now is the time to start taking steps towards achieving those goals. 

Have you opened any new accounts or made significant purchases in the last year? If so, how do the newly acquired assets fit in with your long-term goals, both during life and after?  

Check the titling of your accounts, review your beneficiary designations, and inform your estate planning attorney about those new assets, policies, and revisions to your goals.  

The foundation of financial fitness is one’s estate plan. That may seem contrary to common sense because most clients believe that the estate plan is for your family once you are gone. However, your Designation of Health Care Surrogate, Durable Power of Attorney, Revocable Trust, and Living Will each contain provisions specifically designed for management during your lifetime.  

The attorneys in the Trusts and Estates Department of PLDO are available to ensure that the foundation of your financial fitness propels you towards success during the New Year and for the years to come.