Are You Rich? Then You Should Probably Have This

Are You Rich? Then You Should Probably Have This

Ben Geier  Thu, August 10, 2023

Trusts are useful financial tools, often used for the purpose of planning an estate. A trust is essentially a legal framework into which ownership of assets can be placed. These assets can include financial products like stocks and bonds, or it can include real physical property, like land, jewelry or vehicles. There are a number of reasons one might use a trust, including, but certainly not limited to, estate planning scenarios. If you think you might need a trust or you want help setting one up, consider working with a financial advisor.

How Property Trusts Work

Technically speaking, there isn’t a specific type of trust known as a “property trust.” Any trust can be filled with a myriad assets, including property and real estate. If you hear reference to a property trust, it's more than likely either a revocable trust or an irrevocable trust. Both of these can be seeded with property, along with other assets like investments, family memorabilia and cash.

A revocable trust is one where you have the ability to add property and take it out throughout your lifetime. For instance, if you store a home in a revocable trust, you can remove it from the trust. At a later date, you can then return it to direct ownership if that makes it easier to sell. You can also remove personal effects, such as a family heirloom, if you want to pass it on to another family member. A revocable trust can also be abolished if it's no longer necessary.

An irrevocable trust, on the other hand, is exactly what it sounds like - a trust that cannot be abolished and cannot have property removed from it. Irrevocable trusts are best used to shelter property that the current owner is not going to sell or otherwise need out of the trust.

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Who Needs a Property Trust?

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