Trusts can take several different forms, sizes, complexity, and can serve a variety of difference legal purposes including tax, investment, and personal issues. All trusts will have three key positions, 1) a settlor, 2) a trustee, and 3) a beneficiary. The settlor is the creator of the trust who places assets in the trust for the benefit of the beneficiary. The trustee is charged with the duty to administer the trust according to the trust creation documents and to ensure the trust's purpose is fulfilled. Finally, the beneficiary is the person or entity that will receive the benefit of the trust.
The most significant advantage of a trust is the ability to pass assets upon your death without involving the probate court process. The ownership, or beneficial interest, will pass immediately upon your death by operation of law rather than by order of the probate court.
Other advantages include tax savings, protecting assets from creditors, financially supporting others, or making charitable donations for years to come.
Any well-designed estate plan should include a trust for these reasons and a whole lot more.
