A trust is legal ownership of assets provided by a granter to a beneficiary and governed by a trustee. More parents and grandparents are setting up trust funds to secure their children's financial futures. Trusts can be used for education, living costs or as a money set aside to provide for the child in the event of a parent's death. Trust funds minimise death and inheritance taxes, preserve wealth and help with estate planning.
Visit a bank to sit down with an accounts representative to open a trust fund.
Select the type of trust you want to open. The two basic types are living trust fund and after-death trust fund. The living trust fund allows you to manage and control the assets while you are still alive. The after-death trust fund will just sit in the bank and only be managed after your death per your instructions.
Select the status for the trust fund, revocable or irrevocable. With the revocable trust fund, you can change the inclusions and conditions as you wish through the years. A revocable trust fund is also exempt from probate. The irrevocable trust fund is considered separate from your other assets for legal and tax purposes.
List the name(s) of the executor or trustee who will carry out the conditions of the trust in the event of your death. Choose someone you trust and who is responsible enough to take over the task after you cannot.
Go over the documentation and list the conditions for the trust fund. Choose whether you want the details of the fund to be disclosed or concealed from the beneficiaries. Allocate the assets for the trust fund. If it is an monetary amount, add it to the trust fund account at the bank. Sign all the documents. Three copies of the trust fund should be prepared: one for the bank, one for you and one for your lawyer.