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  • What Is A Trust?

    Trusts are separate legal entities, like corporations.

    Trusts hold assets for you or for the benefit of others.

    Assets inside a trust are managed by a trustee who has legal responsibility for managing and overseeing trust proceeds in accordance with your wishes. The trust stipulates how your assets should be managed, and how, when and to whom your assets will be distributed.

    Many people think only the wealthy can benefit from trusts. But this is simply not true. Trusts are highly flexible and can provide for an almost unlimited combination of needs, circumstances and objectives.

    Because they can be designed to satisfy such specific needs and circumstances, trusts can address the concerns and objectives of most people. These include:

    • Business owners and other individuals who wish their financial affairs to be private
      Unlike wills, trusts can hide assets and their disposition from public scrutiny armed with information from a probate proceeding. For example, a competitor might be able to force the sale of the decedent’s business at a below-market price.
    • Owners of highly appreciated assets
      When highly appreciated assets are sold, a large chunk of the gain may go to taxes. A trust can shelter property from taxes on income and capital gain and thus avoid the tax bite. Setting up a charitable remainder trust (CRT) provides the grantor with income for life and creates charitable tax deductions.
    • Dependents
      Trusts offer a method of providing regular income to dependents and the possiblity of tax savings for you. They also offer control through the choice of mandatory or discretionary payments, as you may specify to suit the dependents' changing support, educational and medical needs. In addition, trusts can provide for the orderly passage of one’s property without the expense, delay, or publicity of probate, and for professional investment management for family members who lack this skill.
    • Retirees, widows, widowers
      A trust can provide a monthly check, freedom from making investment decisions and the burden of bookkeeping details. It can also provide for the management of financial affairs in the event of illness or incapacitation, and tax savings on future gifts to charity.
    • Spouses in second marriages
      A trust can protect the interests of children from a previous marriage, and spare friends and family members from legal conflicts.
    • Parents of children with special needs
      Trusts can ensure that children and others with special needs will have their financial concerns properly addressed.
    • Individuals concerned about becoming ill
      Trusts ensure that their financial affairs will be handled properly. They also handle the obligation of naming a guardian or conservator to oversee these responsibilities.
    • Unmarried couples and close friends
      A trust can provide a "significant other" with income for life while keeping assets in the grantor’s family. Upon the death of the loved one, assets can revert back to a family member or to a specific charity.
    • Individuals who need help in handling their finances
      Trusts can manage the assets and oversee all responsibilities regarding record-keeping and tax preparation for those unwilling or incapable of handling their financial affairs.
  • What Trusts Can Do
    • Ensure the orderly and private transfer of your property
    • Secure the cost of providing for an elderly relative, parent or disabled child
    • Help finance a loved one’s education
    • Create a portable and highly flexible pension plan
    • Avoid probate costs
    • Protect assets from a creditor’s claims
    • Provide a structured way to administer your personal and financial affairs should you become incapacitated
    • Make a tax-advantaged charitable gift
    • Manage assets for the benefit of your heirs and other beneficiaries
    • Provide for the continuation of alimony or child support payments
    • Save a business from an untimely liquidation or disadvantageous sale
    • Avoid unnecessary capital gains taxes
    • Manage your estate tax exposure
  • How Are Trusts Used?

    You can use trusts to ensure the orderly and private transfer of property to another individual or to secure the cost of providing for an elderly relative, parent or disabled child. Trusts can help finance a loved one’s education and even serve as portable pension plans.

    Trusts can help you avoid probate costs and protect assets from creditors’ claims. They can provide a structured way to administer your personal and financial affairs should you become incapacitated, and they can be used to make tax-advantaged charitable gifts.

    You can rely on trusts to manage assets for the benefit of your heirs and other beneficiaries and provide for the continuation of alimony or child support payments. Trusts can save a business from an untimely liquidation or a disadvantageous sale.

    Trusts are also used to avoid unnecessary capital gains taxes and manage your estate tax exposure. Without proper estate planning for example, your beneficiaries could stand to lose as much as 80% of their inheritance to taxes under current law.

    Whether a trust contains $100,000, $500,000 or $5 million, trusts can make an immeasurable difference in the lives and circumstances of a wide range of individuals with varying financial needs and considerations.

  • What Are The Most Common Types of Trusts?

    Basically two types of trusts exist: living (or inter vivos) trusts and testamentary trusts. The revocable living trust is the most common and is created during your lifetime. In contrast, the testamentary trust is created after your death by the provisions of a will and provides no lifetime benefits.


    RBC Trust acts as trustee for all types of personal trusts including:

  • What Can Go into Trusts?
    • Stocks and bonds
    • Real estate
    • Mutual funds
    • Variable annuities
    • Capital management accounts
    • Life Insurance
    • Art
    • Collectibles
    • Personal possessions; and more