When you're making your living trust with WillMaker, you may come across some terms that are new or unclear to you.
Unfortunately, you can't escape legal lingo entirely when you deal with living trusts. A complete onscreen glossary is available at www.nolo.com/dictionary. But keeping it simple, here are definitions for some key living-trust-related terms, broken down into four categories:
- Legal Concepts
If you can't find it on first pass, try CTRL-Fing for the term you're looking for.
GRANTOR, TRUSTOR, SETTLOR
- The person who sets up the living trust (that's you).
- The person who has complete power over the trust property. You are the original trustee of your living trust, so you keep total control over property in the trust. If you and your spouse or partner make a trust together, both of you are the initial trustees.
- The property you transfer to trust; trust property.
- The person you name to take over as trustee after your death. The successor trustee's job is to transfer the trust property to the beneficiaries, following the instructions in the Declaration of Trust. The successor trustee may also manage trust property inherited by young beneficiaries.
- The inheritors of trust property when the grantor dies.
- Alternates are the back-ups who will get a role if your first-choice is not available. For example, you will name a beneficiary to receive trust property, and you will also name an alternate beneficiary who will get that property if your first choice dies before you do. A "second alternate" is the back-up to the back-up and will only serve if your first two choices cannot.
- In WillMaker's living trust, you must name someone who will decide when you no longer have capacity to manage your own affairs – this is your capacity decision maker.
- In WillMaker's living trust, a custodian is the person you name to manage a minor's property through the Uniform Transfers to Minors Act (UTMA).
MAKING A LIVING TRUST
- Making a living trust involves several steps. 1) You make the trust document that names property, beneficiaries, and successor trustees. 2) Then you must sign the trust in front of a notary public and get a notary's certificate of acknowledgement. 3) Finally, you must transfer any titled property into the trust.
FUNDING A TRUST
- "Funding" a trust means transferring property into the trust. After you've done that, the trust is "funded."
- After you make the trust document, you must sign your living trust document in front of a notary public. The notary public will then "notarize" the trust by signing, stamping, and attaching a statement affirming that you signed the document. This statement is called a "certificate of acknowledgement." Notaries public also provide other statements and services.
- After you make a trust document, you must sign it in front of a notary public who will then notarize your living trust.
- Witnessing refers to having a person watch you sign a document to act as a verification that you did the signing. You do not need witnesses to finalize your living trust – your signature and the notary public's certificate of acknowledgement make your trust effective.
- Finalizing your trust means all of the things you need to do with your trust after making the trust document. That is, signing it, getting it notarized, transferring property into it, and storing it safely.
PUTTING A TRUST INTO EFFECT
- Your living trust document is not "in effect" until you sign it, have it notarized, and transfer into it any titled trust property.
CERTIFICATION OF TRUST
DECLARATION OF TRUST
RESTATED AND AMENDED TRUST
- In WillMaker's living trust,