Trusts allow a person to designate their assets to a beneficiary. While you may have heard of trusts before, you might still have a few lingering questions about the document. A seasoned attorney can ensure that a comprehensive trust reflects your wishes. Below are four frequently asked questions and answers about trusts.

Common Trust Questions, Answered

What is a trust?

Trusts are legal documents drafted by an attorney that holds property or money for a beneficiary. The grantor—the person who owns the assets—can serve as the trustee, or appoint a family member or friend to fill the role. A trustee ensures that the assets are divided according to the grantor’s wishes.

How does a trust work?

Many trusts are sold at market value at the time of their establishment. As time passes, the assets increase in value. Depending on the grantor’s rules, the beneficiary may not use their trust to pay off outstanding debts, sell it, or use the funds for anything other than what the trust is intended for.

Why do people use trusts?

Attorneys may draft trusts for several reasons. Grandparents or older adults will create a trust to fund a child’s education or to give them a financial safety net. Parents often establish trusts for their minor children, leaving their assets—including their home, vehicles, finances, or business—to them. In other cases, a trust can be created to protect a personal business or to ensure that one’s assets are spent correctly after one’s passing.

When does the beneficiary receive their assets?

In some cases, the beneficiary receives their assets entirely at the discretion of the trustee. In other cases, there is an age restriction, with the beneficiary only able to draw assets from the trust once they reach the certain age, and in other situations, multiple beneficiaries must draw from the trust in a particular order.

If you’re interested in creating a trust or other financial document, contact Greene Law, PC, in Farmington, CT. Each attorney at the firm provides comprehensive, expert service to all clients, specializing in personal injury law, estate law, and family law. To schedule a consultation, call (860) 676-1336 or visit their website to learn more about their estate planning services.