In estate planning, you may often hear these titles being kicked around: Personal Representative, Beneficiary, or Trustee.
But who are these people and what do they have to do with your Legacy Estate Plan?
Let’s find out.
Trusts, Beneficiaries and Trustees.
Before we can have a beneficiary or trustee, we first need to have a “trust.”
Very briefly, a trust is a fiduciary arrangement which can form part of an estate plan. The trust is best analogized to an LLC, or essentially a company that holds your assets for the benefit of someone (the “beneficiary”). There are generally 3 parties to a trust:
- The Settlor (or Grantor): The person who establishes the trust fund.
- The Beneficiary: The person who benefits from the trust fund. This is the person that the trust property (money, stocks, real estate etc.) will be managed for and will be used to benefit, as laid out in the specific instructions given by the Settlor when he or she establishes the trust.
- And, the Trustee: The trustee is the person, persons, or institution (like a bank), that manages the trust fund to ensure that your wishes for the beneficiaries are carried out.
It is the trustee’s duty to follow the instructions in the trust documents and to make sure that the assets in the trust (money, property, stocks etc.) are safeguarded, invested appropriately, and are used to benefit the beneficiary.
There are many kinds of trusts, a lot more to it, and every state has its own laws governing the types of trusts permitted – all of which is why it is important for you to consult with knowledgeable Arizona Trusts and Estates counsel about what is right for you.
Personal Representatives and Beneficiaries.
When you have a Last Will and Testament, or a “will,” in it you will appoint someone as your “Personal Representative.” The Personal Representative is the person who will gather up your assets, get your will probated, and administer your estate after you die. He or she will remain in charge of your estate until it is legally closed.
Your Personal Representative is responsible for, among other things, making sure that your wishes are carried out.
In the context of a will, your “beneficiaries” are those who inherit from you under the terms of your will.
Sound a little Complicated? Don’t worry, We Are Here to Help You!
We Are Estate Planning Attorneys. We have offices in Sedona and we serve Verde Valley as well as all of Arizona. We offer free consultations and we can help you with your estate planning needs. Contact us to set up your free appointment.