INTRODUCTION TO TRUSTS
WHAT IS A TRUST?
To state it in the simplest terms, "A trust is a right of property, real or personal, held by one party for the benefit of another."
A trust then, is a contract in which an individual (variously called the Settlor, Creator, Trustor, or Grantor) transfers property to a trust (or trustee), to be held or managed for one or more beneficiaries. Most trusts feature the same person in control and getting benefits (as without the trust). They typically make the kids beneficiaries (or after life of the creators).
There are many types of trusts designed for a variety of purposes. The Family Living Revocable Trust is generally the trust created by almost all attorneys.
WHAT IS A FAMILY LIVING REVOCABLE TRUST?
Many similar titles are used to mean the same type of trust. Some of these are:
- Revocable Trust, usually meaning exactly the same as:
- Family Trust... or
- Living Trust... ("intervivos" in Latin) or
- Revocable Trust... or
- Living Revocable Trust... or
- Revocable Living Trust... or
- Living Revocable Family Trust
(or a combination of the same words in different order)
As we stated above, "A trust is a right of property, real or personal, held by one party for the benefit of another." or, more exactly, a trust becomes the owner of your property instead of you, but remains under your control (you are the Trustee); for the benefit of you and/or your family. In other words, you still keep control and use, but designate the eventual ownership, after you can't own it anymore.
A trust is better than a will. A will is basically a guide for a judge to make his determinations. Wills are often disputed and must be expensively supervised by the court. A judge can easily determine results contrary to wishes of the creator, and usually high unnecessary expense, as well as wasted time.
Fortunately, a trust can eliminate the court supervision, can eliminate court costs, can provide for un-interrupted management, can operate exactly as you planned it, and can be managed by people you selected yourself, without interferance, and without delays.
PRIVATE ASSET PROTECTION
A Private Asset Trust is far better than a typical family trust. It has all the benefits of the simple trust, with additional benefits. The proper design and language of a trust can provide complete asset protection, as well as other options. Certain rules and proper legal language must be contained in the trust to provide management, protection, and privacy. Flexibility can also be included within the trust, although care must be taken to restrict flexibility that could eliminate benefits.
There are ways for a Private Asset Trust to provide privacy and protect seniors, minors, disabled persons, education, structured allowances, pet care, immature individuals, medical care, convalescent care, retirement, lawsuit avoidance, investing, business management, spending, distributions, stock ownership, bank accounts, vehicles, collectables, charities, and most any other conceivable asset.
You can provide for (or protect against) family members, ex-family members, friends, second families, or your favorite charity. A trust can protect assets from divorces, family disputes, and members of the family kept from being a beneficiary.
You can determine your own levels of complete or moderate privacy.