There are many different varieties of Trust, and this can become confusing to anybody not familiar with the relationship between Trusts and Wills. In this article we will give an overview of Trusts, what they mean, how they work, and which types of trusts can be incorporated into your Will. At LegalWills.ca we support a number of different types of trusts, but certainly not all of them. It is also important to be certain when reading about trusts that you are reading Canadian material. Resources from the United States are very different, and much of the US information is not applicable to Canadians with Canadian assets.
What exactly is a Trust?
A trust is made up of three components. There is a “Grantor” (or “Settlor” or “Trustor”) who describes the parameters of the trust. There is a “Trustee” who manages the trust once it is set up, and then there is a “Beneficiary” of the trust – the person who benefits from the trust being in place. The key point is that by making the Trustee manage the contents of the trust on behalf of the beneficiary, there is more control over the contents of the trust. The beneficiary does not control the trust themselves.