IS A TRUST RIGHT FOR YOU?
Deciding whether or not a trust is right for you and your estate plan is the first step and is often part of a conversation
with an estate planning attorney when determining what your goals are for your estate. There are many benefits to
having a trust in place; the most common reasons are noted here. A trust may be the right estate planning tool for
you if you:
• Are concerned about the management of your assets if you become incapacitated.
• Want to protect your assets against mismanagement by beneficiaries, or from creditors (including ex-spouses) of
beneficiaries.
• Want to provide for minor children.
• Are married to a non-U.S. citizen.
• Want to provide for a family member with special needs.
• Are part of a blended/modern family (divorced/remarried/same-sex marriage).
• Want to avoid probate and maintain privacy.
• Want to reduce estate taxes (state or federal).
KEY ROLES
It’s a common misconception that trusts are only for the wealthy, but as you can see from the list above, that is not
true. Many people can benefit from some form of trust in their estate plan. While there are many different types of
trusts that serve many different objectives, all trusts involve at least three parties: the grantor, the trustee and the
beneficiary.
Grantor: The grantor is the person who establishes the trust and puts assets into the trust, including cash, life insurance, various accounts, stock and titled assets such as vehicles or property, etc.
Trustee/Co-trustee: The trustee is responsible for administering the trust by carrying out the directives and managing the assets. The trustee is either an individual(s), corporation or both.
More than one trustee can be selected (you should name a successor trustee in the event the original trustee is
unable to act as trustee for the entire duration of the trust). The duties of a trustee depend on the type of trust and
vary before death/incapacity and after. This person might need to handle difficult personal, financial and legal issues
as they arise.
PROS AND CONS OF USING A CORPORATE TRUSTEE
PROS
CONS
Experience with record keeping, tax returns
May lack knowledge of specific family situations and goals
Objective decision making
Charges a fee that may be greater than an individual trustee
Not impacted by death or inability to serve
Charges a fee that may be greater than an individual trustee
Beneficiary: The beneficiary is the person or persons for whose benefit the trust is administered. A beneficiary may
be entitled to receive some or all of the trust’s net income, receive distributions of trust principal or receive the trust
assets when the trust terminates.