What Is a Trust?

The Three Roles

Every trust has three parts: the grantor (also called settlor) who creates the trust and transfers assets into it; the trustee who manages the assets according to the trust’s terms; and the beneficiaries who benefit from them. In a typical revocable living trust, one person fills all three roles initially — you manage your own assets for your own benefit — and names a successor trustee to step in during incapacity or after death.

What Trusts Are Good At

• Avoiding probate. Assets held in the trust pass to beneficiaries without court involvement — faster, cheaper, and private.
• Planning for incapacity. The successor trustee can manage assets seamlessly if you become unable to, without court proceedings.
• Controlling distribution. Trusts can stagger inheritances (for example, distributing at ages 25, 30, and 35), provide for a surviving spouse while preserving assets for children, or support a beneficiary with special needs without disrupting benefits.
• Privacy. Unlike probate, trust administration is generally private.

What Trusts Do Not Do

• A revocable trust does not save taxes by itself, nor does it protect assets from your creditors during your lifetime.
• It does not replace the other documents. You still need powers of attorney, advance directives, and a pour-over will.
• It does not work unfunded. The trust document alone changes nothing; assets must be transferred into it.

Costs and Considerations

Creating a trust costs more upfront than a simple will — it is a more complex document, and funding takes effort. Whether that investment pays off depends on your situation: the value and type of your assets, your state’s probate costs and timelines, your privacy preferences, and your incapacity-planning needs. An estate-planning attorney can help you weigh a will-based plan against a trust-based plan for your specific circumstances.