Trust
Last updated 17 July 2026
A trust is a legal arrangement in which a settlor or grantor places assets under the control of a trustee to hold and manage under stated terms for beneficiaries or, in recognised cases, a defined purpose. The trustee holds legal title and must exercise powers under the trust deed and applicable law. Beneficiaries hold the rights or interests given by that framework.
Trusts vary widely. They can be revocable or irrevocable, discretionary or fixed, created during life or at death, and governed in different jurisdictions. The label alone does not establish who controls the assets, who pays tax, or whether a beneficiary can demand a distribution.
Why it matters for family offices
Families use trusts to organise succession, protect vulnerable beneficiaries, maintain continuity, support philanthropy, and, where conditions are met, pursue privacy, asset-protection, or tax objectives. None of those outcomes is automatic. They depend on the deed, retained rights, transfers, trustee independence, administration, parties, and jurisdiction.
The family office must preserve trust-by-trust boundaries. Each trust has its own assets, liabilities, beneficiaries, powers, tax and reporting position, and decision makers. Consolidating wealth for analysis should not blend legal ownership or imply that the principal can use trust assets personally.
How it shows up in practice
Suppose a family has one revocable trust for a founder, an irrevocable trust for descendants, and a charitable trust. All three hold investments at the same bank. A consolidated portfolio report can show combined exposure, but the office maintains separate accounts and ledgers because the trustees, beneficiaries, distribution powers, and purposes differ.
When a beneficiary asks the office to pay property costs from the descendant trust, staff do not treat the request as a normal family bill. They give the trustee the deed provisions, distribution history, and trust liquidity needed for a decision. The trustee then acts within its authority and records the reasoning. Accurate structure data supports both consolidated oversight and lawful separation.
Related terms
Grantor (Settlor)
The individual or entity that creates a trust and transfers assets into it, also known as the settlor, trustmaker, or trustor depending on jurisdiction. The grantor defines the trust's terms: who benefits, who serves as trustee, and how assets may be used. In many UHNW structures, the founding generation acts as grantor of the trusts that will carry wealth forward.
Trustee
The individual or institution legally responsible for holding and managing trust assets in the best interests of the beneficiaries. Trustees owe fiduciary duties of loyalty and care, and their decisions are governed by the trust deed. Families often combine professional trustees with trusted advisers or family members to balance expertise and family insight.
Beneficiary
A person or entity entitled to receive benefits, such as income, capital, or discretionary distributions, from a trust, estate, insurance policy, or foundation. In family wealth structures, beneficiaries are usually family members across multiple generations. Understanding who benefits from which entity is essential for accurate consolidated reporting of family wealth.
Irrevocable Trust
A trust that cannot be unwound by the grantor once assets are transferred in, permanently removing those assets from the grantor's ownership. That permanence is what delivers the benefits: estate tax reduction, creditor protection, and multi-generational control. Most sophisticated wealth transfer structures, from dynasty trusts to GRATs and insurance trusts, are irrevocable.
Revocable Trust
A trust the grantor can amend or dissolve at any time during their lifetime, commonly used to avoid probate and direct how assets pass at death. Because the grantor retains full control, revocable trusts offer no estate tax savings or asset protection. Their value lies in privacy, continuity, and smooth administration when the grantor dies or loses capacity.
See how family offices put this into practice
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