Trust & Will to Launch Chartered Retail Trust Company
The overwhelming industry trend in the past 25 years is moving from physical capabilities to digital ones.
With its announcement of the launch of a chartered retail trust company, online estate planning provider Trust & Will is doing just the opposite, leveraging its digital success to expand into the ‘analog’ realm.
The new Trust & Will Trust Company is a Nevada-chartered retail trust company with the legal authority to serve as a professional corporate trustee. Its founding marks Trust & Will as the first in the rapidly growing digital estate planning space to serve as a regulated corporate fiduciary.
“With the Trust & Will Trust Company, we are evolving from the platform that helps families create an estate plan into the fiduciary that can carry one out,” said Cody Barbo, co-founder and CEO of Trust & Will.
That said, the new trust company is not looking to directly compete with the heavyweights that already exist in the wealth space.
In a call with Wealth Management, Barbo explained that existing trust companies offer a vast array of options and incredible service, but to maintain that level, they’ve had to consistently push upmarket, raising the minimum bar of entry, often into the tens of millions of dollars. That’s left households with less than $10 million, who can benefit greatly from less exhaustive trust services, largely unserved. Those are the clients that Trust & Will Trust Company is looking to take on.
“A trust holding a house, a retirement account, and a life insurance policy needs a trustee just as much as one holding millions of dollars,” said Barbo. “The difference has never been the need. It has been who was willing to do the work.”
By leveraging its existing technological expertise in the estate planning space, the new trust company is offering what Barbo calls a “very traditional trust administration experience”—largely, though not solely, based on a directed trustee model—that is software-agent-delivered but backed by a human fiduciary. Tasks like recordkeeping and accounting, trust tax return preparation and filing, making distribution decisions in accordance with the terms of the trust, beneficiary communication and reporting.
In doing so, the firm hopes to offer more streamlined trust services with no minimum account size to clients who would otherwise be locked out of the corporate fiduciary experience. The ultimate goal, according to Barbo, is to shorten the time it takes to get inheritances into beneficiaries’ hands. Fees will be based on account value and the nature of the assets held in trust.
Future plans include building a simple dashboard for beneficiaries to help them follow the administration process until the money is ultimately in their hands. “Like a Domino’s pizza tracker for your trust,” said Barbo.
Notably, clients who use the Trust & Will estate planning service to create a trust will be offered the new company as a trustee option, but will retain the freedom to name whatever trustee, corporate or otherwise, that they’d like.
The initial rollout will be largely direct-to-consumer, and the firm won’t be courting advisors with existing private trust company relationships or in-house PTCs. “We want to maintain our position as ‘Switzerland,’ in the wealth planning space and want to stay highly respectful of existing relationships,” said Barbo.
“Our software is still our strength,” Barbo said. “Eventually we hope to exist as an option in advisors’ menu of corporate trustees, show that our technology works and eventually sell it back to the heavyweights in the industry who may lack these capabilities to serve less wealthy clientele.”
