Choosing A Trustee

Golden Fiduciary Services (GFS) is a trust service office of Midwest Trust Company, a Kansas non-depository trust company regulated and examined by the Office of the State Banking Commissioner of Kansas.

GFS is not affiliated with Golden Financial Services, LLC, a registered investment advisor.

GFS is independently owned and operated.

 

Questions and Answers for All types of Trusts:

1. How many clients/trusts does the company currently manage?

We have over one hundred trusts, Conservatorships and investment accounts under full management.

 

2. What is the dollar amount of assets under the company’s management?

Our office has more than $90,000,000 under management.

 

3. How are the assets allocated and what is the investment approach?

The allocation of assets varies depending upon the Investment Objective Statement (see more under #5 below), which puts in place the guidelines used to direct invested dollars. We feel that especially Special Needs trust funds and Conservatorships should always be managed conservatively, employing a well-balanced, diversified portfolio and a disciplined approach to rebalancing.

 

4. What is our investment approach? What criteria are used to determine the allocation of assets? What types of assets do we include in portfolios?

Applying modern portfolio theory, we carefully choose the proportions of various assets, including individual stocks and bonds, Mutual Funds, Exchange Traded Funds (ETF’s), Individual Bonds, Real Estate, CDs and other asset classes for diversification. The assets are held in an Institutional Brokerage Account. We actively rebalance the portfolio, using a very disciplined approach to managing risk.

Our fees are all-inclusive and there are no additional trading fees. However, on rare occasion, there may be a minor cost associated with the purchase of an ETF, stock, or bond.

Above and beyond our extensive regulatory and internal safeguards, GFS seeks to provide safety and security through our conservative yet proactive approach to investing. Within this conservative territory, there are greater and lesser degrees of conservativeness. Where a given portfolio allocation falls on such a scale will depend, among other things, on the age of the beneficiary, known/assumed financial needs of the beneficiary over time, and input from the beneficiary and/or circle of support. We view the trust dollars for the majority of our clients (see #3 above) as being the equivalent of retirement dollars. Therefore, it is paramount that we protect each beneficiary’s invested assets to the greatest extent possible.

 

5. How willing is the trustee to let the family/beneficiary/TAC influence actual investments?

We always welcome the input of all interested parties and take into consideration their knowledge of investments and concerns. We develop the portfolio by also considering risk tolerance, time horizons, and the beneficiary’s needs. Prior to taking any action regarding the actual investments in the portfolio, an Investment Objective Statement is formulated. This statement is our “roadmap,” with asset allocation goals and objectives clearly spelled out. We seek your input in developing the roadmap.

 

6. Is the company bonded or insured?

Through Midwest Trust Company, GFS is covered by a Financial Institution Bond as well as Management Liability and Fiduciary Liability insurance. Midwest Trust carries all liability insurance and other client protections required by its regulator. If required, we can add additional coverage on a case-by-case basis.

 

7. Is GFS familiar with mandated court reporting and how is it handled?

Court reporting requirements vary from state to state and from trust to trust. We normally employ the services of an attorney in the state in which the trust is domiciled to advise on state reporting requirements, as well as to produce and file reports with the appropriate court. The attorney relies on us to provide key components of the report: accounting, portfolio results, fee disclosures, caregiver-related details and, of course, important information about the beneficiary’s life, health, and overall situation.

 

8. How often can reports of transactions be sent out?

At the beginning of each calendar year we send out two accounting-related reports: 1) an Annual Summary of Disbursements, reflecting totals by accounting category; and 2) Disbursements by Vendor, a detail of each disbursement. On a quarterly basis, we send a Portfolio Report. On any given date, upon request, we will provide reporting.

 

9. If I ask to see a routine ledger report (i.e., Summary of Disbursements), such as is sent to clients, is it understandable to an ordinary person?

The Summary of Disbursements report is very clear and reads like a regular checkbook. Every disbursement is categorized, for example: clothing, auto repair, prescriptions.

 

10. What is the process for requesting a disbursement?

A phone call, fax, e-mail, etc., to the Chief Trust Officer is sufficient to initiate a disbursement request or to begin the research process for a project or large purchase. Requests outside of those in the annual, pre-approved budget will require review by a committee. Some trusts and/or Trust Advisory Committees require a more extensive approval process, depending on the language in a given trust document.

 

11. How does GFS communicate with the beneficiary, Trust Advisory Committee members, and other interested parties?

Depending on the circumstances and your preference, we will communicate with you by phone, e-mail, fax, mail, and/or in person. We encourage open communication. We like to get to know our clients and frequently call just to see how things are going. We expect that if you call us you will get a live person on the phone 99% of the time. In the event of non-medical emergencies, we can be reached on a 24/7 basis. We return calls promptly.

 

12. Fees: How much does GFS charge?

Our basic annual fees are stated in terms of a percentage of assets under management and reflect the total of trust administration and investment management services. There are break points above $1MM and above $2MM. Each type of trust has a different fee schedule. The basic fee for an Asset Protection Trust is 1.15% on the first million dollars. For a Support Trust, as well as a Conservatorship, the basic fee is 1.35% on the first million dollars. The basic fee for a Special Needs Trust is 1.50% on the first million dollars. Our minimum annual fee for trusts and Conservatorships is $2,500.00. During the first year of any new trust or Conservatorship we charge: a $750 Intake (setup) fee; an additional $1,500 fee if the trust or Conservatorship is below our published minimum of $500,000.

See #13 below for potential Client Advocacy charges.

 

13. Are there any additional costs/fees?

We reserve the right to charge, on an hourly basis, for Client Advocacy, which covers a wide variety of services.

If we are required to file an annual court report for a trust, there will be additional charges for legal representation. Note that our fees include the assembling and preparation of financial and other information, which is then given to the attorney who prepares the report.

An outside accounting firm does tax preparation and their fees are additional. Any taxes due are paid from the trust. We do not charge for the considerable effort involved in collecting, organizing, and managing the process of tax preparation.

You will see that our fee schedule is lengthy. This reflects the fact that we are ready, willing and able to take on an extraordinary role with our beneficiaries. We will be clear, in advance, regarding costs for extraordinary services. Charging for additional services is the exception—and not the rule.

 

Questions and Answers for Special Needs Trusts:

1. What percentage of the trusts managed by the company have special needs provisions?

Approximately 50% of our trusts are Special Needs Trusts.

 

2. Does the trustee use a pooled account?

NO. Each trust, Conservatorship and investment account is an individual account, which is separate from all other clients’ assets as well as those of Golden Fiduciary Services.

 

3. What is the company’s knowledge of disabilities, Medicaid, SSI, and Medicare?

Christopher Scance, the President and CEO of Golden Fiduciary Services, is a Certified Financial Planner (CFP) with a degree in finance from George Washington University. For the past 26 years his primary focus has been on Estate Planning for Persons with Disabilities. Our employees are well trained and thoroughly experienced in these areas. In a word, it is part of our corporate culture, as approximately 50% of the trusts managed by GFS are Special Needs Trusts. In addition, we also have ready access to outside consultants with expertise in a wide range of areas. We believe that our combined knowledge of and resources relating to the issues facing persons with disabilities and their families are second to none.