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A living trust is a legal entity capable of owning property. It allows you to gather
your property into one document and ensure that the property is distributed easily
and quickly after your death.
When you put your property into a trust, the trust, not you, owns that property.
This doesn't mean that you no longer have control of your assets. Since you, the
grantor, will usually appoint yourself as the trust's initial trustee, you still
have complete control of your property. You can do what you want with that property
- you can even transfer property out of the trust or add property to it. A living
trust is an easy way to keep track of all your assets and manage them as a single
unit. Most importantly, a trust allows you to provide for the quick and efficient
distribution of your property to loved ones when you die.
Declaration of Trust
A living trust is created with a document known as a Declaration of Trust. This
is the legal document that names your beneficiaries, describes your trust property
and provides for the terms of its transfer. The living trust is managed by the trustee.
In most cases, the initial trustee is the person who forms the living trust. You
may later designate someone else or an institution, such as a bank, to act as a
trustee. The trustee is also responsible for managing the property covered by the
trust.
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