Name the primary duties a trustee owes to protect and preserve trust principal.

Name the primary duties a trustee owes to protect and preserve trust principal.

• A. Loyalty, prudence, diversification, care, and accountability; follow the instrument, avoid commingling, and minimize unnecessary costs.
• B. Speed, secrecy, and maximizing fees.
• C. Investment in a single asset to maximize returns.
• D. Avoiding any oversight and avoiding reporting.

Answer: (B)

Fiduciary duties protect and preserve trust principal. A trustee must act with loyalty to the beneficiaries, use prudent judgment in managing assets, diversify to spread risk, and exercise careful stewardship. They’re responsible for following the terms of the trust, keeping trust property separate from their own assets, and minimizing unnecessary costs. These duties are meant to safeguard the principal so it can endure and benefit the beneficiaries over time, instead of chasing speed, secrecy, or higher fees, or concentrating all investments in one asset. Accountability and transparent reporting are also essential, ensuring decisions are open to review and aligned with the trust’s purposes.

Fiduciary duties protect and preserve trust principal. A trustee must act with loyalty to the beneficiaries, use prudent judgment in managing assets, diversify to spread risk, and exercise careful stewardship. They’re responsible for following the terms of the trust, keeping trust property separate from their own assets, and minimizing unnecessary costs. These duties are meant to safeguard the principal so it can endure and benefit the beneficiaries over time, instead of chasing speed, secrecy, or higher fees, or concentrating all investments in one asset. Accountability and transparent reporting are also essential, ensuring decisions are open to review and aligned with the trust’s purposes.