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NEWS

How Trust Funds Work

How Trust Funds Work
There are three key parties that comprise a trust fund—grantor (sets up a trust and populates it with their assets), beneficiary (a person chosen to receive the trust fund assets), and trustee (charged with managing the assets in the trust).


The primary motivation to establish a trust fund is for an individual—or entity—to create a vehicle that sets terms for the way assets are to be held, gathered, or distributed in the future. This is the key feature that differentiates trust funds from other estate planning tools. Generally, the grantor is creating an arrangement that, for a variety of reasons, is carried out after he or she is no longer mentally competent or alive.