How To Use Assets In A Trust
Video Transcript
Ray Hrdlicka – Host – Attorneys.Media
Is there, once a trust is created—and I assume this is a question that people often ask—if I use a trust, if I put assets into a trust, can I do something with those assets or are they locked away from me? My beneficiaries are the only ones that are going to be able to do anything with it. So once they’re in a trust, it’s gone from me, I can’t do anything with it. What’s the answer to that question?
Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA
Right, well, the easy answer is that before you create a trust, you are the one who earns the money, you’re the one who spends the money on your own purposes, and you’re the one who will enjoy all that you have. If you create a trust, all you’re doing is identifying what your assets are, you’re putting them in this trust, you’re naming yourself as the trustee, and you’re naming yourself as the first and primary beneficiary.
So really, there’s no difference. You just put a different hat on. You put your creator hat on—the trustor hat, sometimes called the settlor or grantor. And then you take that hat off, you put your trustee hat on. You, as the grantor or settlor, have given instructions to yourself as the trustee about what to do. Then you take that hat off and put the beneficiary hat on.
And the beneficiary hat is basically who you are. You name yourself as the beneficiary and realistically, nothing changes. You’re writing your checks to pay your bills. You pay your mortgage. There is no difference. You’re just putting a little bit of structure in place.
Then you look at yourself as having three roles. And realistically, before you create the trust, you still have the same roles, right? You create the trust. You’re the one who does the work. You’re the one who does it for yourself: creator, provider, worker, laborer, and then you are the beneficiary.
So you’re basically doing the exact same thing. You just make it look a little bit more formal. And that’s how you can avoid probate.
Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA
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