What is a Trust?

A trust is a legal arrangement in which one person, known as the settlor or grantor, transfers ownership of assets or property to another person or entity, known as the trustee. The trustee holds and manages the assets on behalf of one or more beneficiaries according to the terms and instructions specified in the trust document.

The trust document outlines the rules and conditions under which the assets are to be managed and distributed. These rules can be quite flexible and can be customized to meet the specific needs and intentions of the settlor. The trust document also identifies the beneficiaries who are entitled to benefit from the trust.

The primary purposes of creating a trust are often to protect and manage assets, provide for the financial needs of loved ones, minimize estate taxes, and ensure the proper distribution of assets according to the settlor's wishes. Trusts can be revocable or irrevocable, and they can be created during the lifetime of the settlor (living trust) or through a will (testamentary trust) upon the settlor's death.

Trusts are commonly used in estate planning to avoid probate, maintain privacy, and establish a structured framework for the transfer of assets. They can also be utilized for charitable purposes, asset protection, and special needs planning.

It's important to consult with a qualified attorney or financial advisor when considering the creation of a trust, as the laws surrounding trusts can be complex and vary across jurisdictions