Category: Wills & Trusts – the Basics

Wills & Trusts - the Basics

What is a Trust? The 7 Ingredients to Cook Up a Healthy Trust

“What is a Trust?” In my Massachusetts estate planning practice I am asked that question all the time.

In its most basic terms, a trust is an arrangement under which one person, called a trustee, holds property (such as real estate or bank accounts) for another person, called a beneficiary.  It is usually created with a document called a “declaration of trust” or an “agreement of trust.”

There are different types of trusts. One of the most popular is a “living trust” which is simply a trust that you create while you’re living.  In contrast, a “testamentary trust” is one that is written in your will and is created after you die.

Trusts have different uses. Some of them can help you avoid probate, while others help protect your children’s inheritance after you are gone. (Let’s face it, most of us wouldn’t want our 18 year old kids to have access to thousands of dollars when we’re gone, so a trust can help prevent that from happening).

Because there are different types of trusts with different uses, writing a trust is sometimes like creating a very special recipe in the kitchen. But, like any recipe, a trust is made up of different ingredients, all of which are needed to compliment the dish. Here are 7 ingredients to cook up a good trust:

  • A Person setting up the trust. This person is the trustor, settlor or grantor and it is the person who wants to make the trust.
  • Objective of the trust. Since different types of trusts achieve different objectives, you need to figure out what your goal is. Is it to avoid probate? Protect an inheritance? Plan for nursing care?
  • Beneficiary. A trust needs a beneficiary – someone who benefits from the trust in some way. Maybe it’s your children or your grandchildren.
  • Trustee. The person in charge of the trust is called the trustee. They are going to be managing the money or property that you put in trust.  Because the trustee is the manager, he/she needs to understand the rules that you create for the trust.
  • The Rules of the trust.  To carry out the purpose or objective of your trust, any good trust is going to need a set of rules that will be followed by everyone involved. Some of the rules that must be followed are automatically part of the type of trust you chose, while other rules depend on what you put into the trust agreement.
  • Property. Finally, you’ll need to put some property in trust. It can be almost any type of property: real estate, bank accounts, mutual funds, even a boat!  But, after you place property into a trust, the trustee will need to manage the property according to the rules that you’ve established.

Trusts come in many different varieties. Regardless, when you’re setting up a trust, you need to decide what type of trust you want and make sure that you follow all the rules for that particular type of trust to make sure that it’s proper and legal, and carries out your intentions.


Don't leave a financial mess for your loved ones. Get some Family Legal Planning done before it's too late.

The Family Legal Planning system at Phillips & Garcia has been designed to help busy families get their Massachusetts estate planning done in a convenient and affordable way. To learn more about trusts and how they can be used in your estate plan, schedule your complimentary Family Legal Planning session with Attorney Andrew Garcia. To speak with Attorney Garcia call him at (508) 998-0800 or email him at [email protected]



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Five Estate Plan Dos & Don’ts

Have an estate plan? Well if you don’t, your among good company. About 50%-60% of Americans don’t even have a will.

So here are 5 quick Dos and Don’ts when it comes to estate plans.

  • Don’t name your minor kids as beneficiaries of your insurance policy.  If something happens to you before they turn 18, then a court will have to appoint someone to manage their money for them. And, even worse, when they turn 18, they’ll have instant access to everything that’s left.
  • Do have backup Health Care Agents named. You may feel you only trust one person deciding whether to “pull the plug” or make clutch decisions in an emergency, but if that person’s not available because their taking a dream vacation in Barbados, you need to have someone around to make those tough choices.
  • Don’t put one of your adult kid’s names on your bankbook because it’s convenient. A lot of elders will add an adult child’s name to their bank accounts for convenience and think that they’ll  “do the right” thing when they’re gone and split the money amongst the other siblings.  But, putting their name on an account can make them an outright owner of the money and they may choose to not split the money with their brothers and sisters after you’re gone.
  • Do name guardians of your minor children. This one’s a “no brainer.” It’s simple, if you don’t name guardians yourself, then a Probate Judge who knows nothing about your family and your values will make the decision for you after you’re gone.  And, you may not like that decision.
  • Don’t put off creating a plan. Let’s face it, between jobs, kids, family, soccer practices, homework, dance recitals, life is busy. It’s easy to let the days slip on by without one. But, every time you step out of the front door, something could happen to you.  I know it’s not what you want to think about, but strokes, heart attacks, auto accidents, even criminal violence, can happen. If you haven’t planned something, then your loved ones will be left cleaning up the financial mess you leave behind.

Make this year the year that you leave the other half of Americans behind and get an estate plan done.

Andrew Garcia, Family Legal Planning Attorney

Don't leave your loved ones with a financial mess. Get some Family Legal Planning in place before it's too late.

The Family Legal Planning system at Phillips & Garcia has been designed to help busy families get their estate planning done in a convenient and affordable way. To schedule your complimentary Family Legal Planning session with Attorney Andrew Garcia just call (508) 998-0800 or email him at [email protected]

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What is Probate?

Massachusetts Family Legal Planning Attorney, Andrew J. Garcia

I am asked this question frequently. “Probate” is the court-supervised process of collecting and then distributing a deceased person’s assets (their personal property such as bank accounts and mutual funds, and their real estate).

It usually includes some of the following:

  • proving in court that the deceased person’s Will is valid (if they had a Will);
  • identifying and then preparing an inventory of the deceased person’s real and personal property;
  • paying the debts and taxes of the deceased; and,
  • distributing the property according to the terms of the Will, or if there is no will then according to state law.

Probate involves paperwork and usually court appearances by attorneys (although lawyers aren’t required). Court filing fees and attorney’s fees are paid from the property of the estate.

If the deceased person left a Will, an executor will have been named. The executor is the person named to identify and collect all of the assets of the deceased person and to see that the terms of the Will are carried out.

Probate generally involves two things: time and money.   Between court costs, filing fees, and attorney’s fees, probate can be expensive. It can also take months or even years to wind through the Probate Court.

Probate is also a public forum. This means that anyone can look at the files which contain information about the property of the estate and its value. They can also learn the identities of the heirs.

For all of these reasons, probate is a process that many people want to avoid. And, it can usually be avoided by using a living trust.

To learn more about the probate process or living trusts, contact Family Legal Planning Attorney, Andrew Garcia of Phillips & Garcia at [email protected] or call him at (508) 998-0800.