Trust is an abstract mental attitude toward a proposition that someone is dependable. It’s a complex neural process that binds diverse representations of self, other, situation, and emotion into a semantic pointer. Trust is a core part of human relationships and many aspects of our daily lives, from romantic partnerships to business operations, and medical practices to politics.

Trust can be complicated and intimidating for those not familiar with it, particularly when planning for their own future. In the business world, trust is an important aspect of operating a company and can even be more valuable than capital itself.

But in estate planning, trust is also an essential tool that can help protect you, your family, and your assets. The purpose of a trust is to separate the legal ownership and beneficial ownership of the assets held within it, which can include bank accounts, investments, real estate, and more. There are three parties involved in a trust: the grantor, the trustee, and the beneficiaries. The grantor establishes the trust by putting assets into it and creating the terms for its operation. The trustee manages the trust, including distributing income and assets to the beneficiaries in accordance with those terms. The beneficiaries receive the benefit of the trust’s assets and income, and they can be individuals, corporations, charities, or institutions.

The process of setting up a trust can be daunting, but the first step is to hire an experienced estate planning lawyer to create a trust instrument for you and to provide guidance on how to use your trust in your own situation. Your attorney should be one that you trust and feel comfortable working with. Consider asking your network of friends and business associates for recommendations or looking for a law firm with which you already have an ongoing relationship.

Once you’ve selected your attorney, decide what assets you want to place into the trust and how you want to structure those assets, whether revocable or irrevocable. Decide on a trustee who will be in charge of managing the trust, and whom you want to serve as beneficiary(ies). Depending on your plan, there may be current beneficiaries (who will receive distributions from the trust) or future beneficiaries (who will receive the trust’s principal at some future date).

A trust can provide numerous benefits to its creator and its beneficiaries. For example, irrevocable trusts can be used to reduce taxable estates by treating the assets in the trust as a separate tax entity from the grantor’s own personal assets. They can also help to protect the assets in the event of a lawsuit or divorce.

Once you’ve established your Trust, the next step is to fund it. This is the process of moving assets into the Trust to make it the new owner. This can be a fairly simple process, and much of it just involves renaming an asset to indicate that it’s Trust-owned. Then, when the time comes, you can distribute the Trust assets to your beneficiaries according to your wishes.