A trust is a legal arrangement where a person (the grantor) transfers assets to a trustee, who holds and manages those assets for the benefit of designated beneficiaries. Trusts can be used for estate planning, asset protection, and managing assets for specific purposes.
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Estate Planning
Trust
Definition
A trust is a legal arrangement where a person (the grantor) transfers assets to a trustee, who holds and manages those assets for the benefit of designated beneficiaries. Trusts can be used for estate planning, asset protection, and managing assets for specific purposes.
Example
You might set up a revocable living trust to hold your assets, which allows you to avoid probate upon your death and provides for the management of your assets if you become incapacitated.
Key Points
- 1Legal entity holding assets for beneficiaries.
- 2Managed by a trustee according to the grantor's instructions.
- 3Can offer privacy, probate avoidance, and tax benefits.
- 4Can be revocable (changeable) or irrevocable (permanent).