A lot of us are the first in our family to do a thing. For some it’s to complete a certain level of education. For others it’s to have a certain type of job or comfort level.

Regardless, you and your ancestors have worked hard to get where you are. Once you have achieved a certain thing, you want to preserve it for future generations.

In the US we can do this in a number of ways, but setting up a trust is one of the most common.

A trust is simply a document that specifies just what is supposed to happen with certain assets – money, property, ongoing residual income, etc.

For example, my grandfather was a trusts and estates lawyer – he helped people with wills and trusts and helped distribute their assets when they died. He wrote a trust for his own assets. His trust had creative provisions to help instruct his family on what he wanted. He specified that his grandkids only received their share of inheritance if they had completed a four year degree or had worked full time for four years straight. He was worried that one of my cousins was a bit unambitious and didn’t want to enable that. So he specified what he wanted to happen with his money.

There are a lot of tax benefits that can be avoided by using a trust as well. Each circumstance is specific, but often a trust is a better option because it doesn’t levy tax against a particular person, but against the trust as an entity, and the tax code applies differently.

The crucial piece about having a trust is that the assets of a person have to be transferred into the trust. The trust has to own everything, instead of it being the property of the individual person. We’ll see this a lot in real estate especially. In looking up the deed, it will be titled in the name of the living trust of John H. Doe. That means Mr. Doe doesn’t “own” the trust anymore.

There are two types of trust and they are treated very differently. If you are contemplating creating a trust, work with an attorney and be VERY clear on whether you want an irrevocable living trust or a revocable living trust.

An irrevocable living trust means you put the assets into the trust and you can no longer control them. This is done sometimes to avoid particular taxes, or protect assets from liability in a lawsuit or divorce. However, once a trust is irrevocable and assets have been transferred into it, that trust is now exclusively in control of the assets. They aren’t yours anymore, they belong to the trust and you can’t change the trust. There may be good reasons to create an irrevocable living trust while still alive, but they are very VERY limited and specific and it’s rarely the right choice.

By contrast, a revocable living trust is often a good idea for people wanting to ensure their legacy is protected in a specific way. This puts in place a particular set of rules and plans for when you die, but still allows you the flexibility and control to adjust the terms of your trust as your life and family evolve. You can transfer assets into and out of the trust relatively easily in the event you need to sell something or increase your liquid assets.

A shorthand is an irrevocable trust – it’s permanent and you have no control after it’s set up. A revocable trust – it’s all in your control and can be changed whenever you want it to before you die.

Another incredible benefit of a trust is that it keeps things private. A normal will has to go through probate – a court filing that makes the whole process part of a public record. A trust specifies what happens and how things are distributed and what the particular wishes of a deceased person may be without making that public.

If you want to be in control of protecting your legacy and the success you and your family have worked hard to achieve, a trust is often the best way to do that. The kind of trust and what makes sense to include in it are questions for you and your attorney.

***This is not legal advice, this is only to inform you of options. If you have any questions, consult with an attorney licensed to practice in your jurisdiction.