Trusts can be a useful tool when planning for long-term care needs and estate planning. There is no one size fits all trust, and the best trust is one that is custom built to meet the needs of an individual. A trust, by definition, is a relationship between a settlor, a trustee and the beneficiaries.
A settlor may also be called a donor or grantor, is the person who creates the trust and transfers property to the trust. A trustee is the person who is responsible for administering the trust and ensures the terms of the trust are met. The beneficiaries are the people who benefit from the trust.
The document that sets up the trust is a written set of instructions from the settlor to the trustee, for the benefit of the beneficiary. It should be written by an experienced elder law attorney, especially if the need for benefits such as VA Special Monthly Pension or Medicaid may be needed down the road to cover the costs of long-term care at home or in a skilled nursing home.
Most commonly, trusts are put into place to ensure that someone will be taken care of and protected. Often, the trust is put in place to manage the assets for a minor or someone who is not capable of making sound financial decisions due to disability, or to ensure that the assets will not be spent frivolously.
