What is a trust fund?

A trust fund is a legal arrangement where one person, known as the settlor, sets aside money or property for another person, known as the beneficiary. The trust fund is managed by a third person, called the trustee, who is responsible for managing the trust fund and making decisions about how the money or property is used. In Michigan, trust funds are often used to help a beneficiary manage their finances. They can be used to set aside money for college, retirement, medical care, or other expenses. Trust funds can also help protect assets from being taken by creditors or used to cover medical costs. Trust funds are generally created by either writing a will or entering into an agreement with another individual or entity, such as a bank or financial institution. The trust fund may be set up as a revocable trust, which means the settlor can revoke or change the trust at any time. Alternatively, the trust fund may be set up as an irrevocable trust, which means that the settlor cannot make changes to the trust without the permission of the trustee and the beneficiary. No matter how they are created, trust funds are intended to help the beneficiary manage their assets or ensure that the settlor’s wishes are carried out. The trust fund can be used to cover things like debt payments, education expenses, or medical costs. It can also be used to pass on assets to the beneficiary in the event of the settlor’s death. In Michigan, trust funds are an important part of estate planning and can provide financial security for the beneficiary.

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