What Is A Trust? What Benefits Do Trusts Offer Us?

A trust is basically an agreement where a single person or a married couple (the grantor or creator) give their assets to another person who acts as the trustee (manager) and the trustee holds it for the benefit of the third person who is the beneficiary. The grantor(s) act in three capacities: grantor, trustee and beneficiary, while alive. The trustee will manage the trust assets just as they always have.

So a trust is a legal way to hold assets. It sets out who the beneficiaries are during the lives of the grantors and who the beneficiaries are after the grantors pass; who the trustees are; and how the trust will be administered. As far as benefits, a revocable living trust saves your family time and money by avoiding probate -- the court controlled process which is expensive and time-consuming. A trust confers several other benefits as well. Unlike a will, a trust has provisions for a successor trustee when a trustee becomes incapacitated and is no longer able to manage the trust assets.  So that avoids the necessity for a possible conservatorship where you have to go to court and have someone appointed to act for the incapacitated person. That is a very expensive and lengthy process. Good estate planning avoids that. Another benefit is that a trust is harder to contest than a will.  So if there is a dissatisfied family member who wants to get in a fight and contest it, the trust makes it more difficult.