What is a trust?

A trust is a legal arrangement where an individual (a “grantor”) transfers ownership of assets to another individual (a “trustee”) for the benefit of a third party (a “beneficiary”). In North Carolina, this arrangement can be used to manage finances and property for senior citizens, people with disabilities, or for families. A trust can be used to protect assets from creditors and unforeseen events like lawsuits or medical bills. The grantor can set out specific instructions for the trustee, such as when and how the beneficiary will receive money or property from the trust. The trustee is responsible for managing and distributing the assets in the trust according to the grantor’s instructions. The trustee must also follow North Carolina’s laws regarding trusts, as well as the grantor’s precise instructions about the trust. Trusts are often used within elder law, especially in North Carolina where they are a popular form of asset protection. Trusts can be used to provide secure financial arrangements for elderly family members during their lifetimes, and can also be used to ensure that a loved one’s assets are distributed according to their wishes upon their death. Trusts are also commonly used in special needs planning, in order to provide for a disabled individual’s needs without jeopardizing their eligibility for government benefits.

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