How Much Should a Trustee Be Paid in Fees?

Trustees are tasked with the trying —and often thankless— job of managing trust assets to benefit the trust’s beneficiaries. In exchange for their services, California Probate Code §15681 allows trustees to receive “reasonable compensation.” However, if the trust document itself specifies different pay arrangements, then under Probate Code §15680, trustees are legally entitled to be compensated according to the terms of the trust.

How is a trustee fee calculated?

Because the only standard for trustee compensation set in California law is that it must be “reasonable,” fees can vary widely depending on the circumstances. Unfortunately, this means that there is no exact mathematical formula that can be used to quickly and universally calculate trustee fees. However, you can educate yourself about standard practices when it comes to trustee fees in California.

There are three different types of trustees that may be responsible for administering a trust, each of which is usually compensated differently. Generally speaking, trustees will either receive a certain percentage of the trust’s assets or an hourly rate. The standard fee structure for each category of trustee is outlined below. 

Corporate Trustees

Corporate trustees are typically banks or investment firms that are hired to administer the trust. Most corporate trustees are paid a percentage of the trust assets —usually between 1% to 2% per year—for their services. So, if a trust has $1 million in assets, a corporate trustee would receive between $10,000 and $20,000 in annual fees.

Professional Trustees

Professional trustees, also known as private professional fiduciaries, are individuals who manage trusts and conduct other fiduciary tasks as their profession. While professional trustees are typically paid an hourly rate of over $100, they may receive a percentage of the assets for some trusts.

Private Trustees 

Private trustees are individuals (typically a family member or close friend of the trust maker) who are appointed to administer a trust. These trustees are hardly ever paid with a percentage fee structure. Instead, they usually collect between $25 and $35 per hour for their work on the trust. However, some private trustees may elect not to collect compensation for their services, particularly when administering family trusts.

How does a trustee get paid?

Trustee fees are paid out of the trust’s assets. While trustee fees are most commonly paid quarterly, the terms of the trust may specify that the trustee be paid annually or twice a year. 

In addition to fees, trustees are entitled to receive reimbursement for trust-related expenses that they pay out of pocket, whether or not the trust instrument contains any instructions on the matter. Common reimbursable expenses include travel costs, storage fees,  insurance premiums, and taxes. However, the trustee must keep accurate records of their expenses in order to receive reimbursement.

What if a beneficiary contests a trustee fee?

Several possible results can occur if a beneficiary contests a trustee fee. First, under California Probate Code §17200, a beneficiary can submit a petition to the probate court to set trustee fees or review the reasonableness of the trustee’s compensation. The judge can then order lower fees if they find the existing arrangement to be unreasonable.

California Probate Code §15642 also allows for a trustee to be removed from their position as trustee on the petition of a beneficiary if the trustee’s compensation is excessive under the circumstances. Additionally, if a trustee commits a breach of trust, California Probate Code §16420 allows a beneficiary to request that the trustee’s compensation be reduced or denied to make up for the breach.   

When should I contact a trust litigation attorney?

If you believe that a trustee is charging unreasonable fees for their services in administering a trust, you should immediately contact a trust litigation attorney to discuss the situation. An experienced lawyer can review the specific circumstances involved to determine the reasonableness of the trustee’s fees and advise you on the best course of action available. 

Have questions? We’re happy to discuss.
Call (424) 320-9444 or email [email protected]

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About RMO, LLP

RMO LLP provides personal and efficient inheritance dispute services to individual and institutional clients. The firm’s attorneys focus on probate litigation involving contested trust, estate, probate, and conservatorship matters. Serving California and Texas, with offices in Los Angeles, Pasadena, Orange County, San Diego, Fresno, the Bay Area, Dallas, and Houston. For more information, please visit

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About the Author

Scott Rahn, Founding Partner

Scott Rahn resolves contests, disputes and litigation related to trusts, estates and conservatorships, creating a welcome peace of mind for clients. He represents heirs, beneficiaries, trustees and executors. He utilizes his experience to develop and implement strategies that swiftly and efficiently address the financial issues, fiduciary duties and emotional complexities underlying trust contests, estates conflicts and probate litigation.

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