Trusts
Trusts have been used for thousands of years. Recently however, they have grown in popularity.
A trust, is a written agreement that names someone to be responsible for managing property for the benefit of others.
Trust actors:
- Settlor or Grantor - You, the person who creates the trust.
- Trustee - Usually you. The person who agrees to manage trust property as directed by the trust agreement.
- Successor Trustee - You can name more than one successor trustee to act if you are unable to do so.
- Beneficiaries - Individual or entity that will receive the income and or principal from the property in the trust.
For your trust to function properly, your property must be transferred to the trust.
Think of it this way. If you purchase a safe for your belongings and you do not put those belongings in the safe, the safe is useless. The same is true of trusts. You must "fund," or to be more specific, re-title your assets into the trust for it to function properly.
It is a popular misconception that assets funded into a revocable trust are no longer under the control of the grantor. Untrue. Because you are the trustee for your trust, you remain in complete control.
For those of you that already have a trust but are unsure if your assets have been transferred to the trust, Attorney Patrick will review your situation free of charge in the initial consultation.
A trustee nominated to handle your trust estate has a fiduciary duty to follow the directions of your trust structure. You need someone in place that can handle this responsibility. Depending on the type of trust structure and your circumstances, you, and your spouse, if appropriate, are the initial trustees of the trust.
For a husband and wife scenario, it usually appropriate for the spouse with capacity to continue on as trustee of the trust when the other is unable to do so. If you are not married, children or close family can usually handle the responsibility of successor trustee.
Some important attributes of a good successor trustee candidate include:
- Trustworthiness as there is generally no oversight of your trustee's action.
- Fiscally responsible so as to handle your financial affairs appropriately.
- Easy to communicate with as necessary.
- Depending on the goal of trust, proximity may be important.
What is most important, is that your successor trustees be the best choice for your estate. This process is not about making people feel equal. It is about assuring your wishes are followed when you no longer have a say in the matter.
If you have questions about trusts of any type, contact Michigan trust attorney Dean E. Patrick at 248-663-2566 for a free initial consultation.
