Trusts offer a way of managing money or property for people who are unable or not yet ready to manage it for themselves. A trust is simply an agreement which sets out assets in relationship to individuals. For instance a property could be held in trust for a particular person, known as a beneficiary.
The settlor is the person who creates the trust. He or she decides how the trust’s property and income should be used and create the deed (or rules) for the trust.
The settlor appoints trustees to manage the trust. Trustees are the legal owners of the trust property. There are generally between 2 and 4 trustees and all trustees must act unanimously. Under English law, trustee’s decisions cannot be made by a majority of trustees unless the trust specifically allows this.
A trustee can also be a beneficiary of a trust.
This is the property that is put into trust by the settlor. It can include:
The role and responsibilities of a trustee should not be undertaken lightly. If you have been chosen as a trustee, the settlor feels that you can be trusted to act in the best interests of the beneficiaries, and can manage this important role.
The role of the trustee is to manage and administer the Trust property in line with the terms of the Trust
You should familiarise yourself with the terms of the trust so that you can follow the trust rules.
Assets should be registered in your ownership and you should deal with any aspect of these in line with the terms of the Trust.
You should take care and advice if necessary when making investments.
If life insurance policy proceeds become available before distribution is desirable, you should invest the money.
You should not put yourself in a position of conflict between your own personal interests and the interests of the trust and its beneficiaries.