by Tobias | 02.Aug.2016 | Trusts
Who Should We Provide your Trust Fund Management Services? Since the main purposes of setting up a trust fund are to protect and to grow one’s assets, choosing who is best able to provide the necessary management services is a decision that needs careful thought. It may also depend upon the version of this financial instrument that is to be used and this takes two possible forms. These are known as living and testamentary and are applicable, respectively, to a financial instrument established during the life of the owner (grantor) and to one decreed in a last will and testament, and which will, therefore, only be established upon the death of the grantor. Of course, in the case of the type known as a living trust, one possible solution could be for the owner of the fund to assume the responsibility for providing the management services in person. To do so, however, will require them to have a sound knowledge of the investment market and its trends as well as having sufficient time and the discipline to maintain accurate records, handle any tax liabilities and to make the necessary payments to beneficiaries. Because it is often impractical for the owner to meet all of these commitments, it is more usual to delegate the task to a trustee who may be a friend, a family member or a professional individual or company specialised in this area. It is, therefore, important that trusteeship is seen not as an honour but as a serious responsibility. One possible alternative to this route is a hybrid arrangement in which the trustee remains responsible for...
by Tobias | 02.Aug.2016 | Trusts
The Purpose and Main Benefits of Establishing a Trust Fund Trust funds are not, as many people tend to believe, the sole province of the multimillionaire. However, despite their many potential benefits, they are not a suitable financial instrument for everyone’s purpose. In essence, the term applies to a legal document or deed that may be established by either an individual or a corporation, thereafter known as the grantor. The deed sets out the terms for the management of property and other assets held on behalf of a beneficiary that, once again, may either be a named individual or a group such as a charity. The person or persons to whom the task of management is then assigned are known as the trustees and may be the grantor, a close friend, a family member or a legal or financial professional. The main purpose of a trust fund is asset protection and to provide assurance that property, money and other assets it includes are allocated in accordance with the grantor’s wishes in the event of their demise. A task for the trustees, it serves to avoid unnecessary pressure on the bereaved family members, saving them time, expense and the often-confusing paperwork that are involved when filing probate. Aside from relieving the bereaved family of burdensome legal requirements, there are many other benefits to be gained when choosing this route rather than simply compiling a last will and testament and appointing an executor. A will is simply a means to clarify ones’ wishes regarding the distribution of one’s assets but it offers no means by which to protect those assets. In...
