Your friends tell you that they have a trust as part of your estate plan. They tell you that you should have a trust. Maybe so, but what is a trust and how does it work?
Simply put, a trust is a separate entity you create to hold all of your property. The document establishing the trust is a contract that lays out the rules about how that property can be used while you’re alive and what will happen to it after you pass away. In a standard revocable trust, you, as the grantor, put assets into the trust. You, as the trustee, manage the assets during your lifetime while a successor trustee you name will be in charge after your death. He or she will maintain the trust according to your instructions for the benefit of the trust’s beneficiaries.
In this video from her Estate Planning Series, Bobbi Hines explains how trusts work, the reasons you may want to consider one as part of your estate plan, and the importance of working with an experienced attorney as you explore the many different trust options.