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Prudent investor must exercise reasonable skill, care and caution, must consider the purposes of the trust, terms, distribution requirements in making investments.
Some factors to consider:
- tax consequences
- beneficiary's expenses
- special relation of assets to the trust (real property)
- evaluate each investment at time investment was made
- trustee has duty to diversify
Makes job harder since the trustee has to do more research, know more; but waive of the future.
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