When most people hear the word “trust,” they think of trust funds, wealthy heirs and elderly individuals with high net worths. But a trust is a valuable tool that can benefit many different types of families, and it’s often less expensive than you might expect.

Trusts are an essential part of any estate plan, providing a vehicle to control property and avoid taxes. However, trusts do have initial and ongoing costs that you should consider before making the decision to open one.

A trust is an arrangement where you transfer ownership of your assets to a third party, called a trustee. The trustee manages the trust assets for your benefit and distributes them to beneficiaries according to the terms you establish in a written document, known as a trust agreement. The trustee can be an individual, a company or even yourself. Your attorney can help you determine the best choice for your needs.

The biggest advantage of a trust is that it avoids the expense and delays associated with probate. Your assets stay in the trust until your death, when your trustee will follow the instructions in your will or trust document to distribute them. The trustee can also manage and/or sell your property during your lifetime if it is not needed for distribution to your beneficiaries. This can be beneficial if you are selling a home, starting a business or funding an education.

Other benefits include preserving privacy, reducing administrative expenses and expediting the distribution process. Probate is a public process, so trusts provide another option for ensuring privacy and keeping your affairs out of the spotlight. Additionally, your trustee can invest your trust assets and provide you with regular income distributions.

There are tax advantages, as well. For example, some trusts can reduce your taxable estate and/or state income taxes. In addition, some irrevocable trusts can be structured to protect assets from creditors and preserve the generation-skipping transfer tax exemption. However, tax laws are complex, and the benefits you receive from a trust can vary significantly based on your unique circumstances.

A trust may be a good option for you if you have significant assets or want to provide special protections for your family. In order to maximize the benefits, it’s important to meet with an attorney to discuss your goals and review the specific provisions of your trust agreement. It’s also important to understand how your assets are titled and whether you need to take any steps to retile them in the name of your trust. For instance, you might need to transfer ownership of real estate into the name of your trust or add a “pour-over” clause in your Will to ensure that all assets are deposited into your Trust upon your death. These steps are often simple, but they can have substantial ramifications.