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Trust Law

What is a trust?

Do I need one?

Those are great questions.

There are three (3) basic parties to a trust.  A trust is a relationship in which a person, called a “trustor” or “grantor”, transfers something of value, called an “asset”, to another person, called a “trustee”. The trustee then manages and controls this asset for the benefit of a third person, called a “beneficiary.”  A beneficiary is the person benefiting from the will, trust, insurance policy or other document. An asset can be any kind of property that has value.

Trusts originally come from England when knights would go on a crusade, they would leave their “assets” (e.g. – their castle, horses, farm animals, and riches) in “trust” to another to watch over them and keep the assets safe while the knight was on his crusade.  In a way, the same is true today.  When you place something in trust, you are giving the “trustee” the charge to watch over that asset and keep it safe.

trust law

You might be asking, what are the uses of a trust?

Another excellent question.

Trusts have several uses and they can be of much benefit when properly set up and managed. One of the uses of a trust is to provide flexible control of assets for the benefit of minor children. A trust set up for the benefit of minor children can avoid the necessity of further legal proceedings, such as the appointment of a conservator. A conservator is someone who is appointed by the court to control the assets of minor children. Conservators are restricted by law and must be bonded and file annual accounting with the probate court.

Trusts can also be used to hold real estate; to keep assets private and out of the court systems in lieu of a probate.  Privacy has long been a reason why people use trusts.  Estate planning is another use of trusts.  Here is a small list of trusts that are frequently used:

Credit Shelter Trust: The Credit Shelter Trust is designed to minimize federal estate taxes. It is essentially a trust for the benefit of the family. It restricts access by the surviving spouse and uses the $1,000,000 exemption of the first spouse to die.

Irrevocable Trust: An Irrevocable Trust is a trust where the terms of which cannot be changed or terminated.

Q-tip Trust: Q-tip stands for Qualified Terminable Interest Property. This is a trust established for the benefit of the surviving spouse and no one else. It is designed to take advantage of the marital deduction and minimize federal estate taxes.

Should You Get a Trust?

Maybe. It’s best to speak with a licensed attorney to guide you in making such a decision.

start with the various parties involved in setting up a trust. First off you have someone known as a settler. Ok, the settler also sometimes known as the grantor, but basically this is the person who gives assets to the trust, so it gives assets to the trust.

Sometimes it could be say, a parent. If we’re setting up a trust for a child, the parent could say, give some assets to the trust. So they say we’re gonna hold the house in a trust. Then we have another party known as the protector or the trustee, so the protector or trustee they’re.

The person who has to give consent before anything can happen for any action can be taken place or something like that. So they give consent for action. Don’t be too concerned about what their actual names are depending on what country are? There will be different terms, but essentially have one party who’s, giving the assets.

You have another party who looks after the assets or manages them, and then you have a third party, which is the one you actually want to be, and that is known as the beneficiary. The person who you know receives the distribution of the assets receives distribution, and this person is known as the beneficiary and job like.

I said that’s. Basically, what a trust is it’s, a it’s, a contract, a lot of things in finance, whether it be shares or bonds. All these things they all are contracts and they’re; a contract between various parties.

In this case, instead of having an investor and a manager or a lender and the person who borrows the money, we have these three individuals, all three parties. It can be groups, I mean it could be a bunch of children as beneficiaries could be a group of people as the trustees or the protectors, but essentially a trust is a contract between parties, and the idea is that there is some sort of asset at play.

So what you have in your contract is you’ll, have you know the terms of the of the contract, so the terms of the contract, all terms of the trust, will determine what asset is. You know there’s, the trust holding who the settle is, who the protector is, who the beneficiary is, and there’s a whole bunch of rules and regulations around what you can have in your class and what you can’t some rules are like the beneficiary has to really be born, so you can’t say I’m gonna be leaving my house to my future grandchildren.

If you don’t, have any grandchildren yet or haven’t been born, but this very much depends on where you’re living. Depending on what country you’re in they’ll have different rules and regulations around what you can and cannot say in the terms of the trust um I mean we can also go into the types of trusts.

I mean the types of trusts. There are lots if you are interested in the types check out Wikipedia. They do have like the A to Z of all the various different trusts that you can get again depending on what country you’re in.

That will determine the various different trusts that are available for you to set up so now. Why do people make a trust? You know? Why do they go through this administrative burden of creating this contract between parties and that’s? What I’m gonna do for the rest of this.

Video is go through ten purposes or ten reasons for creating a trust. So let’s, go with our ten reasons and then, after that you should have a good understanding and we can end the video, because I mean yeah the three things.

I think that make up a trust or the intention may be. Let me write this down here, its intention, which we’re, going to look at now. The ten reasons, the subject matter and the objects you know subject matter is like the terms of the trustee and the objects are the assets, but let’s.

Look at the intentions that’s. What I find the most interesting so the ten reasons number one is privacy, okay and let’s say a public company will receive the word public. They have to disclose their financials, they have to say, you know what they’re doing or that type of stuff.

In some territories trusts have a level of privacy, they can do things or manage assets in a way that does not need to be disclosed to the public, and some people like to be private or like to keep secrets and that’s.

One of the reasons for creating a trust – the other reason is quite a funny one, but it’s for spendthrift children. So let’s say I am a very rich and successful person, but I know that my daughter just loves shopping.

She just loves buying every single shoe that comes on the market. She’s got a big room of shoes, and I know that when I die or even now, if I gave her unlimited access to the bank account, all she has so I give all the assets all my wealth to this trust, but then I set up a trustee to say that, okay, what we gonna do is we only going to give her a million dollars for shopping a month.

You know we’re gonna limit the amount of money that we give her a month so that she doesn’t go and blow it all in one go. So it is a way to to be a bit of a spendthrift. You hear a lot of jokes. Oh, he’s, a trust-fund baby.

It’s. The kid who doesn’t have to go to college and spends his life on a yacht drinking cocktails, and you know partying with girls, that’s, that’s. What Sam trusts are set up for to protect children who aren’t? You know financially sophisticated enough to deal with so much money.

It might be a term saying that once they reach age, twenty-one they get full control or some sort of thing. It also is used in wolves and estate planning, so normally, when somebody dies, their money gets turned into some sort of trust.

Where you have some beneficiaries and people can do all the type of stuff, but it might be beneficial to set up a trust before you die, because in some countries we have something known as a death tax.

So once you die, you have to spend a lot of money to the government because you’ve got. I mean it’s completely bogus super tax. I mean like all taxes, that’s all stupid, but the idea is that you pay this massive tax.

Now, what happens is if you have this beautiful mansion in England? Look at this lovely manor house. You know it’s, a little trees and everything like that, and they say this is worth a hundred million okay and you die, and that tax is now let’s, say ten percent for sake reasons, so it’s.

Ten million that you now owe the government, but you don’t, have ten million pounds or 10 million rent worth of cash just lying around. All you have, or all you’ve been left in the will. Is this mansion, but enough to try and solve this mansion for a hundred million or its market value is gonna take time and the tax man is putting a lot of pressure on you.

So some people end up selling this man’s, mansion for say, 20 million giving half to the taxman and then just having ten million and losing the family’s estate. So what people do is they’ll? Put the mansion before they die into a trust so that when they do die, they avoid the death tax and that’s.

The problem with tax is that it can always be avoided. Hence why there’s. All these extra regulations and tax rules – and it becomes this massive headache for everyone, but it’s. One of the ways is to set up a trust to avoid death tax.

I mean there is so this is something that & # 39. S been recently changed in South Africa, but another thing that people use Trust for was tax planning, so listen too hard um. This was what we had is that you got taxed at a certain rate.

If you received a certain amount of money, so I think in South Africa selling around 40 percent at the high highest income bracket, so you’re making money you’re, getting taxed at 40 %. However, if you set up a trust – and you put all your assets into the trust and you make yourself the beneficiary or you do some – you make your kids or something like that, then the tax rules will assign like just 20 %.

So, by setting up a piece of paper just setting up some sort of contract, some legal entity, you’ve saved yourself, you’ve, have your tax bill and this undermines the whole thing of taxing. You know we the whole idea is we’re gonna tax, the rich and feed the poor, but now, if the rich have got enough financial sophistication to set up these legal contracts, all these trust documents, they could avoid tax and undermine the whole Government socialist policies, so what governments do now is tax trusts are taxed at the maximum, which kind of defeats the purpose of having a trust.

For all these other reasons, and people now have to set up other types of special-purpose vehicles and against very, very confusing, but one of the reasons for setting up a trust was to beat the taxman at his own game, and sometimes it was done intentionally.

Governments would say to the rich look: we’re gonna put on this big tax for sure you know that’s. What we’re gonna get people to vote for us yeah. I hate the rich hate, the rich, but don’t worry. We’ll.

Have this little loophole for you guys? We can have you a little trust and you don’t actually have to pay that much tax. You know, but it’s, good marketing, for us to see that we are punishing the rich for being rich, so it does get very.

Very political and conspiracy theories can pop up around tax planning and Trust and all that another one is around corporate structures. So when you start looking at financials of companies, you start getting quite confused because not all the company is held within one legal entity.

You know there’s, a group holding this that verse there’s. The charity trust is the verse there’s, that there’s this and what they use is they use trust within corporate structures. It does make it quite complicated that’s.

Why, when you want to buy another company – or there is a merger it takes so long. It requires so many people, because trust make it complicated and the reason why they have these corporate structures is for some sort of tax planning.

It is so that there can be some privacy. You know that you use it for a bunch of reasons, but some corporations do use trusts in the structuring of their business. I mean one of the big big key reasons for also setting up a trust is asset protection.

So what I can do is I can go and set up a trust and put a lot of my assets in this trust. Then what I can do is, I can engage in business activities or you know, take up a loan and all that sup stuff.

That really does make the subject quite confusing too new time people I mean another reason for for setting up a a trust could be for sake, co-ownership co-ownership is kind of idea.

Like let’s, say you get married, you decide to put all your money together into a crust or you buy a property with a friend. A trust could be a better vehicle than setting up a whole partnership agreement because might have been a little bit more strict rules, but the whole idea is that trust can be used for co-ownership.

Another reason for setting up a trust is, if you want to start a charity, you can defer, say that the beneficiaries or the poor children in your town, you can give your assets and you can get people to be the protectors and you can manage a charity To be through the whole trust structure, but again it does depend on what country are some countries might say? No, that’s, you know dodgy others might allow it.

I mean we do even see financial trust being set up, and I mean a lot of people say well. Are these really trusts but financial trusts? These are things like unit trusts, pension plans, remuneration trusts.

This is when you set up a trust as some sort of investment vehicle. It gets around certain tax laws. It gets around certain regulations, it does get a little bit complicated and, like I said it does very much depend on what country you’re under, because each country might have its different rules and regulations around financial trusts and then finally, you can set Up a trust in some sort of service delivery industries.

The first question really is, what is a trust? Right? What is it even? The legalese of the answer is that it’s a contract between the grantor, which is the person that creates the trusts, like usually if it’s your trust, you are the grantor; the trustee, who is the person that manages the trust, it might be you, it could be somebody else, and the beneficiaries, who are the people that are going to benefit from the trust either during your life or after your death.

That’s the legalese. What I’ll tell you is that a trust is your rulebook, your rulebook, okay? This is important because if you don’t make your rulebook, you’re going to get the rulebook that the state gives you, okay? You’re going to follow the state’s rules.

So you can make your own rulebook, but you have to create it, and that’s what a trust is for. All right, so there’s two main types of trusts. When I say this, what I mean is, in the whole world of trusts, there are two very general categories of what trusts are.

The first one is what we would consider to be death trusts, also known as testamentary trusts. These are trusts that are created in a will. So the will says, “Upon my death this trust is created.

” Okay? But the trust doesn’t exist during your life, because it’s in your will and your will is a death document. It doesn’t come into being, the trust, until after your death. It doesn’t transition control of assets in the event of a disability.

So if you’re alive and you get sick, this type of trust, a testamentary trust, doesn’t enable somebody to take control of your assets in a disability situation. And almost always it’s going to require a probate court proceeding because it’s created in a will, a will is inherently a document intended for probate, it’s going to require a probate proceeding to create this trust.

That’s what’s a death trust or a testamentary trust. So for this reason, a lot of people don’t feel that these are very desirable, right? These don’t sound like really great things for most of us.

So that’s why we usually when we’re talking about trusts, are talking about things that are living trusts. What this means is that a living trust is a trust that exists during your life, okay? Unlike a testamentary trust that doesn’t exist until after you’re dead.

It shifts control in the easiest way possible upon your death or disability, okay? So, unlike the testamentary trust, a living trust does allow the person that you say gets to be the trustee after you, to take control of your assets that are in the trust upon your disability or even death.

And if you properly fund it, and I’m going to talk about this in a second, a living trust avoids probate, which is really probably the biggest reason why people like trusts, okay? Living trusts come in two categories: revocable and irrevocable.

So let’s talk about that. Revocable and irrevocable living trusts are definitely two totally different legal strategies and they accomplish different goals. With revocable living trusts, which is the most common, by the way, when people call me or people talk to me and they say, “I already have a trust.

“” 9.9 times out of 10 it’s a revocable living trust, okay? We use these almost, I’d say, mostly for probate avoidance, right? The main reason people put together a revocable living trust is to avoid probate.

Also, I look at a very good reason to have a revocable living trust is so that you can shift control in the easiest way possible when you get sick or if you get sick or upon your death. So that’s what revocable living trusts basically two main reasons you’d put one together.

They are private if you keep them that way. So we can keep privacy amongst our family or people that we trust. We don’t have to go through a court proceeding, which is one of the big things that makes it private.

And if you have a properly structured revocable living trust, it can provide asset protection to your loved ones after your death. This is key, not during your life, after your death. It’s important to understand, and this is one of the biggest misconceptions about revocable living trusts out there, revocable living trusts do not provide asset protection to you during your life.

If it’s your trust, a revocable living trust is not intended to provide asset protection. So, one of the biggest complaints I hear from people or people get upset a lot of times, is because they believe that their revocable living trust provides them asset protection.

You just need to understand that that is almost entirely not true, and that’s not the purpose of it, that’s not what it’s meant to do. So don’t go around thinking that that’s what’s happening, if in fact you have a revocable living trust.

But that’s part of the reason why there are these irrevocable living trusts. Once again, we create them while we’re alive but they’re mostly used for just tax planning and then asset protection.

Generally, irrevocable trusts are really used for very wealthy people, because they create a lot of restrictions that a lot of people just don’t want to accept. But we can create irrevocable trusts that don’t have those restrictions, but I would say generally that’s not the way that they’re drafted by a lawyer.

So they do give asset protection to you during your life, and your loved ones after death, if they’re properly written. We can protect assets from the nursing home, from predators, lawsuits, all kinds of things, with irrevocable trusts or types of irrevocable trusts.

So it can provide asset protection to you during your life, unlike the revocable living trust. But when we’re talking about trusts it’s really, really, really, really, really, really important to understand that if you have a trust you want to use a trust instead of beneficiary designations, okay? This is so common.

People will have a trust and they’ll have beneficiary designations simultaneously. There generally is not a good reason for this. It really can cause a lot of problems for you and your family members in the future.

Because, this is the thing, if you have assets, like your 401(k), your IOA, and there’s beneficiaries on them, on your bank accounts, you have transfer on death or payable on death, these are all beneficiary designations.

They are not going to pass according to your will or your trust, they’re not, they’re going to pass according to that beneficiary designation. So, this is confusing to people sometimes because they think, “Well, my trust says that everything’s going to happen they way my trust says.

” But that’s not the way it works when you have beneficiary designations. So it’s very important to understand this. This is an improper way to fund a trust. We don’t want to have a beneficiary designation to people.

We’d want the trust to be the beneficiary most of the time. A lot of times what will happen is, people will go to the bank or they’ll go to their financial planner and they’ll say, “Well, you’re all set.

I did your beneficiary designations for you.” I’d just challenge that because that a lot of times is bad advice. You’re not necessarily all set because your beneficiary designations are not going to create the same type of plan that your estate plan, whether it’s your will or your trust, would do.

So I would challenge that statement. You know, when you’re talking to people at your bank or you’re talking to your financial planner, you have to understand, they’re probably well-meaning, but they’re not lawyers, and they’re telling you only a very small piece of the story.

The small piece of the story they’re not telling you, because they’re not lawyers and they don’t deal with this stuff, is that they don’t explain to you that your beneficiary designations aren’t going to protect your assets if your children get divorced, your children or your beneficiary gets divorced, gets sued, if they are bad with money, have poor spending habits, if they’re in bad money relationships, right? Like the wife that goes and spends all the money, or the husband that goes and spends all the money.

It’s not going to protect your money from those things. If they’re having issues with addiction, or they’re not able to manage their own affairs because they’re sick, right? They need nursing home care or they’re sick or they have a disability, or they have creditors, are going through bankruptcy.

Any of those kinds of things. Beneficiary designations do not protect from any of these things. That’s why I’m saying, if somebody tells you that you’re all set with your beneficiary designation, well, you’re not all set with all of these things.

And a lot of times, at least with my clients, they want to be all set with these things. So that’s why you want to have both a properly written and funded trust, because it can protect your money.

But you have to have the right kind of trust. That’s also why finding your trust is critically important. So what is funding the trust? Well, funding the trust is the process of moving your assets into your trust.

This gets a little confusing for people sometimes. Imagine that you have a bowl and you’ve got fruit in your bowl, right? If you take an orange and it’s outside of the bowl and you put it inside the bowl, is it still an orange? Of course it is, right? I’m not trying to trick you.

So it’s just like the way that the trust works. A trust is like the bowl, it’s a vessel. The orange is your bank account. You put the bank account inside the bowl or inside your trust, it’s still your bank account.

Just like an orange is still an orange. But you need to get it in there. And that’s the thing that most people are not doing, even people that have trusts, is they’re not funding their trusts.

So it’s really important to understand that if your assets are not held by your trust, the trust isn’t worth the paper it’s written on. You have an expensive legal document that is not actually doing anything for you.

So it’s really important, in fact, it’s critical to fund your trust. Also, understand that when your trust is unfunded, a lot of times what this means is that you’re going to end up in probate anyway.

So the reason that you set up the trust is not even going to happen. Your trust is going to be empty and it’s not going to protect your assets from probate. So, unfunded trust is probate, that’s a big thumbs down, we don’t want that.
The first question really is, what is a trust? Right? What is it even? The legalese of the answer is that it’s a contract between the grantor, which is the person that creates the trusts, like usually if it’s your trust, you are the grantor; the trustee, who is the person that manages the trust, it might be you, it could be somebody else, and the beneficiaries, who are the people that are going to benefit from the trust either during your life or after your death.

That’s the legalese. What I’ll tell you is that a trust is your rulebook, your rulebook, okay? This is important because if you don’t make your rulebook, you’re going to get the rulebook that the state gives you, okay? You’re going to follow the state’s rules.

So you can make your own rulebook, but you have to create it, and that’s what a trust is for. All right, so there’s two main types of trusts. When I say this, what I mean is, in the whole world of trusts, there are two very general categories of what trusts are.

The first one is what we would consider to be death trusts, also known as testamentary trusts. These are trusts that are created in a will. So the will says, “Upon my death this trust is created.

” Okay? But the trust doesn’t exist during your life, because it’s in your will and your will is a death document. It doesn’t come into being, the trust, until after your death. It doesn’t transition control of assets in the event of a disability.

So if you’re alive and you get sick, this type of trust, a testamentary trust, doesn’t enable somebody to take control of your assets in a disability situation. And almost always it’s going to require a probate court proceeding because it’s created in a will, a will is inherently a document intended for probate, it’s going to require a probate proceeding to create this trust.

That’s what’s a death trust or a testamentary trust. So for this reason, a lot of people don’t feel that these are very desirable, right? These don’t sound like really great things for most of us.

So that’s why we usually when we’re talking about trusts, are talking about things that are living trusts. What this means is that a living trust is a trust that exists during your life, okay? Unlike a testamentary trust that doesn’t exist until after you’re dead.

It shifts control in the easiest way possible upon your death or disability, okay? So, unlike the testamentary trust, a living trust does allow the person that you say gets to be the trustee after you, to take control of your assets that are in the trust upon your disability or even death.

And if you properly fund it, and I’m going to talk about this in a second, a living trust avoids probate, which is really probably the biggest reason why people like trusts, okay? Living trusts come in two categories: revocable and irrevocable.

So let’s talk about that. Revocable and irrevocable living trusts are definitely two totally different legal strategies and they accomplish different goals. With revocable living trusts, which is the most common, by the way, when people call me or people talk to me and they say, “I already have a trust.

” 9.9 times out of 10 it’s a revocable living trust, okay? We use these almost, I’d say, mostly for probate avoidance, right? The main reason people put together a revocable living trust is to avoid probate.

Also, I look at a very good reason to have a revocable living trust is so that you can shift control in the easiest way possible when you get sick or if you get sick or upon your death. So that’s what revocable living trusts basically two main reasons you’d put one together.

They are private if you keep them that way. So we can keep privacy amongst our family or people that we trust. We don’t have to go through a court proceeding, which is one of the big things that makes it private.

And if you have a properly structured revocable living trust, it can provide asset protection to your loved ones after your death. This is key, not during your life, after your death. It’s important to understand, and this is one of the biggest misconceptions about revocable living trusts out there, revocable living trusts do not provide asset protection to you during your life.

If it’s your trust, a revocable living trust is not intended to provide asset protection. So, one of the biggest complaints I hear from people or people get upset a lot of times, is because they believe that their revocable living trust provides them asset protection.

You just need to understand that that is almost entirely not true, and that’s not the purpose of it, that’s not what it’s meant to do. So don’t go around thinking that that’s what’s happening, if in fact you have a revocable living trust.

But that’s part of the reason why there are these irrevocable living trusts. Once again, we create them while we’re alive but they’re mostly used for just tax planning and then asset protection.

Generally, irrevocable trusts are really used for very wealthy people, because they create a lot of restrictions that a lot of people just don’t want to accept. But we can create irrevocable trusts that don’t have those restrictions, but I would say generally that’s not the way that they’re drafted by a lawyer.

So they do give asset protection to you during your life, and your loved ones after death, if they’re properly written. We can protect assets from the nursing home, from predators, lawsuits, all kinds of things, with irrevocable trusts or types of irrevocable trusts.

So it can provide asset protection to you during your life, unlike the revocable living trust. But when we’re talking about trusts it’s really, really, really, really, really, really important to understand that if you have a trust you want to use a trust instead of beneficiary designations, okay? This is so common.

People will have a trust and they’ll have beneficiary designations simultaneously. There generally is not a good reason for this. It really can cause a lot of problems for you and your family members in the future.

Because, this is the thing, if you have assets, like your 401(k), your IOA, and there’s beneficiaries on them, on your bank accounts, you have transfer on death or payable on death, these are all beneficiary designations.

They are not going to pass according to your will or your trust, they’re not, they’re going to pass according to that beneficiary designation. So, this is confusing to people sometimes because they think, “Well, my trust says that everything’s going to happen they way my trust says.

” But that’s not the way it works when you have beneficiary designations. So it’s very important to understand this. This is an improper way to fund a trust. We don’t want to have a beneficiary designation to people.

We’d want the trust to be the beneficiary most of the time. A lot of times what will happen is, people will go to the bank or they’ll go to their financial planner and they’ll say, “Well, you’re all set.

I did your beneficiary designations for you.” I’d just challenge that because that a lot of times is bad advice. You’re not necessarily all set because your beneficiary designations are not going to create the same type of plan that your estate plan, whether it’s your will or your trust, would do.

So I would challenge that statement. You know, when you’re talking to people at your bank or you’re talking to your financial planner, you have to understand, they’re probably well-meaning, but they’re not lawyers, and they’re telling you only a very small piece of the story.

The small piece of the story they’re not telling you, because they’re not lawyers and they don’t deal with this stuff, is that they don’t explain to you that your beneficiary designations aren’t going to protect your assets if your children get divorced, your children or your beneficiary gets divorced, gets sued, if they are bad with money, have poor spending habits, if they’re in bad money relationships, right? Like the wife that goes and spends all the money, or the husband that goes and spends all the money.

It’s not going to protect your money from those things. If they’re having issues with addiction, or they’re not able to manage their own affairs because they’re sick, right? They need nursing home care or they’re sick or they have a disability, or they have creditors, are going through bankruptcy.

Any of those kinds of things. Beneficiary designations do not protect from any of these things. That’s why I’m saying, if somebody tells you that you’re all set with your beneficiary designation, well, you’re not all set with all of these things.

And a lot of times, at least with my clients, they want to be all set with these things. So that’s why you want to have both a properly written and funded trust, because it can protect your money.

But you have to have the right kind of trust. That’s also why finding your trust is critically important. So what is funding the trust? Well, funding the trust is the process of moving your assets into your trust.

This gets a little confusing for people sometimes. Imagine that you have a bowl and you’ve got fruit in your bowl, right? If you take an orange and it’s outside of the bowl and you put it inside the bowl, is it still an orange? Of course it is, right? I’m not trying to trick you.

So it’s just like the way that the trust works. A trust is like the bowl, it’s a vessel. The orange is your bank account. You put the bank account inside the bowl or inside your trust, it’s still your bank account.

Just like an orange is still an orange. But you need to get it in there. And that’s the thing that most people are not doing, even people that have trusts, is they’re not funding their trusts.

So it’s really important to understand that if your assets are not held by your trust, the trust isn’t worth the paper it’s written on. You have an expensive legal document that is not actually doing anything for you.

So it’s really important, in fact, it’s critical to fund your trust. Also, understand that when your trust is unfunded, a lot of times what this means is that you’re going to end up in probate anyway.

So the reason that you set up the trust is not even going to happen. Your trust is going to be empty and it’s not going to protect your assets from probate. So, unfunded trust is probate, that’s a big thumbs down, we don’t want that.

Utah Trust Lawyers

If you are ready to move forward or would like to speak with an attorney about trusts call Ascent Law LLC for your free initial consultation (801) 676-5506. We want to help you with your trust.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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