Generally, a trust is a way to set aside property for the benefit of a person or an organization. The benefits created with a trust include the trust income and the trust property, and these benefits can go to one person – or can be split up among various individuals or entities. For example, a person (grantor) can create a trust that pays income from the trust property to the grantor's children. The underlying trust property could be distributed to the grantor's children when specified conditions have been met (age, date, etc.) – or the property could be distributed to other beneficiaries, such as the grantor's grandchildren or a favorite charity.
There are many different kinds of trusts, and the intended purpose of the trust determines what kind of trust is called for. Trust types include:
Because different kinds of trusts exist, it is important that you talk with an attorney about the pros and cons of particular trust types, as they relate to your goals for the trust (e.g., avoid probate, reduce/eliminate estate taxes, provide for a favorite charity, provide support for a vulnerable individual in addition to government benefits they receive, etc.).