As a Californian resident who is dealing with matters of trusts or trust administration for the first time, it's easy to get overwhelmed. Which option is right for you? What are the legal ins and outs of trusts? Today, we'll take a look at testamentary trusts.
FindLaw takes a look at what a testamentary trust is, including its purpose, unique features, and how it works together with other aspects of estate administration. First and foremost, testamentary trusts are a type of "express trust". Trusts in general are funds set up while you're living that can either be distributed while you're still alive. For example, trust funds can be used to support those with developmental disabilities.
In this case, a testamentary trust is referenced in your will and only applies after you have passed on. This type of trust allows you to protect your assets from the actions of other family members after you have passed on. You are able to select the trustee who will manage your trust, as well as the beneficiaries that will receive the funds or assets therein. For example, you can determine a family member you trust to be the trustee for your funds, managing them on behalf of your minor children until they are 21.
Setting up a testamentary fund might seem daunting at first, but in reality it's a great way to ensure that your loved ones will be taken care of in accordance to your desires after you have passed on. Consider speaking to an attorney who is well-versed in matters of trusts and estates if you would like to learn more.