A Living Trust Fund

What are the benefits of having one?

A living trust – also known as an ‘inter vivos’ or revocable trust, is a written legal document which states that your assets are placed in trust during your lifetime and for your benefit, and on your death are then transferred to designated beneficiaries called successor trustees.

In a nutshell, a living trust fund is a legal entity that holds property or assets. It is held on behalf of another person, group, or organisation.

They are different from a Will, which is a legal written document with a plan of distribution of your assets after your death – but nothing takes effect until after you die.

A benefit of a living trust fund means that it avoids probate, which often means a faster distribution of your assets to your heirs. Your successor trustee will pay your debts as well as distribute your assets upon your death according to your wishes.

One other benefit of having a trust fund is that only the trustees and the beneficiaries know the contents and conditions of your fund. Secure trust funds can also protect your assets from legal action and provide tax benefits.

They work by having three parties who are involved in the trust fund: you, the grantor, the trustee, and the beneficiary.

The grantor, you, is the person who establishes the trust fund and who places your assets into the fund. The trustee is the person or institution that holds and manages the assets you’ve bequeathed. Finally, your beneficiary is the person that you have chosen to receive the fund’s assets.

A living trust is also known as a revocable trust because it can be changed at any time.

These can update them whenever needed by adding or removing assets and beneficiaries and can even be dissolved, which results in returning the assets to the grantor.

This then allows for more flexibility and control, as changes can be made until the grantor dies.

However, unlike an irrevocable fund, the funds within a revocable trust are still considered part of the grantor’s estate, which can leave them less protected if the grantor faces legal claims, medical bills, or any other debts. In this case, the funds in the living trust can be seized.

By having a living trust fund, you get to define the terms of the trust and which includes how and when you want the contents of the trust to be passed onto your beneficiaries.

Bringing you & your loved ones peace of mind