Trusts

Living Trust - Revocable or Irrevocable

A living trust is a trust for which the Bank, as trustee, usually assumes full management responsibility for the assets placed in trust. Such a trust may be revocable or irrevocable, and established for a variety of reasons. The trustor may need professional or specialized investment management, may not have the skills necessary to manage his wealth, may not have the time to give to managing his investments, or may have other priorities. A trust established for investment management provides financial protection in the event of incapacity and can be structured to avoid probate and obtain tax savings at the death of the trustor.

Testamentary Trust

A testamentary trust is created under a will. A person writing a will may leave property directly to the beneficiaries or leave it in a trust for them, a testamentary trust. Testamentary trusts are established to protect the family, save on taxes, and manage investments, businesses, and farms. Family protection includes preserving the family home, relieving survivors of the responsibility for managing investments and other property, and supplying income necessary to maintain the family’s standard of living. It also includes providing for the special needs of children and eliminating the need to appoint a custodian for the children. (A guardian of the person of minor children is required and this must be an individual, not the Bank.) A testamentary trust enables a person who has been remarried and has children from a previous marriage to provide for the surviving spouse and ultimately channel assets to his or her own children. It is also a way to provide life-long care for children who are suffering from physical, emotional, or mental disabilities.