A trust is a legal arrangement used to hold and manage money, property or other assets for one or more beneficiaries.
The person who creates the trust is known as the settlor. The settlor transfers assets into the trust and appoints trustees to look after them. The trustees become legally responsible for managing those assets according to the instructions contained in the trust document. The people who may ultimately receive the assets or benefit from them are known as the beneficiaries.
A trust can begin during the settlor’s lifetime or be created through a will after their death. Trusts are commonly used to provide for children, support vulnerable beneficiaries, preserve family wealth or control when and how an inheritance is distributed.
The precise rights of the trustees and beneficiaries depend on the type of trust and how it has been drafted.