When you create a trust you create an artificial entity that holds on to, or becomes the owner of, your assets. As the settlor of the trust, you name a trustee who will be responsible for managing your assets. Typically, you are the trustee during your lifetime, and you choose someone to succeed you as trustee after your death. Your trust also names the beneficiaries of your estate and lists the manner in which they will inherit from you.
There are many advantages of having a trust as part of your estate plan. First and foremost, it helps you avoid probate, which can be costly and time consuming, and protects your privacy by avoiding probate related publicity of your estate. A trust can also be used to protect assets from estate taxation or from your beneficiaries’ creditors. You can also include special provisions that lay out how and when minors receive their estates, provide for people who have special needs, or other special considerations.