What is a trust?

by Thomas D. Richards, Lawyer Referral Service Panelist

Ohio law allows for each person to set up a document to safe-keep their assets. This is called a “trust.”  The simplest form of a trust is a “revocable living trust.” Revocable just means that it can be “changed” during the person’s lifetime. The person who is creating the trust to put his or her assets in is called the “grantor” or “trustor.”  The grantor can put his or her house in the trust, cars, bank accounts, and just about anything of value with some exceptions.

The safe-keeping part is a unique part of a trust that requires the grantor to appoint a “trustee.” The trustee is charged by law with very special duties to oversee the assets in the trust and protect them.  The trustee can be held personally liable for losing any of the assets of the trust that he/she has been appointed to protect. The trust will stay open even after the grantor dies, so it is good to know that someone is watching over your assets after you die.

Another unique part of a trust is that it lists who gets the assets that you put into the trust. These “beneficiaries” are the people or organizations who will eventually receive the assets from the trust as gifts.  Beneficiaries can be relatives, friends, neighbors, a church, charity, school, college, etc. You can name multiple beneficiaries in your trust who will each take a certain portion of your trust assets after your death. You can specify set dollar amounts for these gifts or percentages.  The trustee you appoint will ensure that the assets go to the correct beneficiaries in the amounts that you specified while you were alive.

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