What is a Trust?

A trust is a legal arrangement through which one person (or an institution, such as a bank or law firm), called a “trustee,” holds legal title to property for another person, called a “beneficiary.” The rules or instructions under which the trustee operates are set out in the trust instrument. Trusts have one set of beneficiaries during their lives and another set — often their children — who begin to benefit only after the first group has died. The first are often called “life beneficiaries” and the second “remaindermen.”

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