Trust is a fundamental human concept. It is what makes us willing to share our wealth with others, and it is the basis for many important social behaviors, including sharing resources, donating to charity, and dating. A trust is a legal relationship that holds title to assets and requires an obligation to keep or use them for the benefit of another person or organization. A trust may be revocable or irrevocable, and its beneficiaries can include individuals or charities.

A trust is typically established by a grantor, also known as a settlor or testator, who signs a legal document to transfer ownership of the assets from his or her name to that of the trust. The trustee, who is named in the trust document, takes over management of the assets and makes distributions to the beneficiaries according to the terms of the trust.

The trustee is usually a friend or family member, but can also be a professional trustee corporation or trust company. Professional trustees generally provide the greatest level of expertise and are best suited for complex assets, but they can also be expensive. When selecting a trustee, it is important to choose someone who understands the fiduciary duties involved and will act in accordance with the grantor’s wishes. It is also important to have backup trustees in case one of them is unable to serve, and to provide them with detailed instructions about how the trust will be managed.

George: There are many advantages to using a trust in an estate plan, especially for people with significant assets. Trusts can help protect the beneficiaries’ privacy, avoid probate, and make it easier to manage large sums of money. They can also provide flexibility in who receives assets and how they are dispersed. For example, a trustee can stipulate that a beneficiary cannot sell or rent a home and must live in it, or that the property must go to another beneficiary after a certain amount of time. Trusts can also protect beneficiaries from creditors, preserve the generation-skipping tax exemption and lower income taxes, and allow beneficiaries to make charitable donations from trust funds.

A study by Professor Michael Grunig of Stanford University found that people who trust others are more open to risk-taking behavior and are more likely to engage in cooperative activities with those they trust. He theorized that these positive outcomes are related to a person’s concentration of oxytocin, which is released during social bonding and such biological functions as contraction of the uterus muscles and lactation.

If you are considering setting up a trust, it is critical to consult with an experienced attorney who can explain your options and help you choose the best way to manage your assets. It is also important to communicate with your trustees so they are prepared to step in when the time comes and that they know where all the assets are located. This can help prevent disagreements between beneficiaries and reduce the likelihood of litigation after your death.