What is a trust fund?

A trust fund is a legal agreement that allows the individual who creates the trust fund (the “grantor” or “settlor”) to transfer assets to someone else (the “trustee”) to manage and distribute according to the instructions the grantor has established. In New Hampshire, trusts can be created in a few different ways: through a will, a trust instrument created during the grantor’s lifetime, or a trust fund established at the time of death. Trusts can be used to not only provide for the financial needs of beneficiaries, but also to manage and protect a person’s assets for future generations and to minimize estate taxes. When the trust fund is created, the trustee is obligated to use the assets within the trust fund for the benefit of the beneficiaries and to ensure the trust fund is properly managed. The trustee is responsible for making sure the trust assets are invested properly and any income generated is reported to the applicable authorities. The trust fund also sets out the rules for how the assets are to be distributed to the beneficiaries, such as when and how they will receive distributions from the trust. Trusts can be complex and time consuming for trustees to manage, which is why it is important to consult with an experienced estate planning attorney when considering setting up a trust fund in New Hampshire. With the proper guidance, trust funds can provide peace of mind in protecting assets and providing financial security for future generations.

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