A trust is a legal vehicle to transfer assets by allowing a third party (a trustee) to hold and direct assets owned by one party (grantor) in a trust fund on behalf of another party (a beneficiary). A trust avoids probate court and allows you to have control over your assets—not just today, but potentially for generations to come. This provides far greater flexibility than a will.

A trust’s primary benefit is to avoid probate upon the grantor’s death. Probate is typically a long, costly, and public process that must be undertaken when someone passes away with any assets in their sole name. Trusts are an ideal way to avoid this scenario and to have assets be professionally managed over generations and distributed according to the grantor’s intentions.

Trusts can remove assets from an estate, reduce taxes, protect assets from creditors, carry out charitable wishes, and provide income to beneficiaries across multiple generations. They also help to ensure privacy and confidentiality, which is lacking in public probate.

First, a legally binding trust document must be created with an estate planning attorney. Once the trust is set up and properly executed by all parties, the bank can then open an account in the name of the trust and transfer any money into it for funding. The money will be invested according to the asset allocation (balanced, conservative, aggressive, etc.) to which the client has agree.