Updated for 2025 | Axis Estate Planning Education Series
Trusts are often discussed in estate planning, yet many individuals and families aren’t entirely sure what they are or how they work. At their core, a trust is a legal arrangement that allows someone to manage and protect assets for the benefit of another person or purpose. Trusts can support family members, loved ones with special needs, charitable causes, or future generations—and they provide structure, protection, and clarity around how assets should be handled.
At Axis Estate Planning, we believe trusts are powerful tools for protecting what matters most and ensuring your intentions are honored. Whether you’re beginning your planning journey or reviewing an existing plan, understanding the fundamentals of how trusts work is an essential first step.
Key Components of a Trust
The Grantor
The grantor—also known as the trustor or settlor—is the person who creates the trust and establishes the rules under which it operates. The grantor determines which assets will be placed in the trust and how they will be managed and distributed over time.
The Beneficiary
The beneficiary is the person or organization who receives the benefits of the trust. A trust may have one beneficiary or several, and beneficiaries may include:
Spouses or children
Loved ones with disabilities or support needs
Future generations
Charities, scholarship funds, or nonprofit organizations
Trusts allow your legacy to directly support the people and causes you care about most.
The Trustee
The trustee is the individual or institution responsible for managing and protecting the assets held in the trust. The trustee must follow the trust’s instructions and always act in the best interests of the beneficiaries.
A trustee’s duties may include:
Managing and investing assets
Paying taxes and maintaining financial records
Distributing funds or property according to instructions
Communicating clearly and consistently with beneficiaries
This role carries a fiduciary responsibility, meaning the trustee is legally required to act with honesty, care, and loyalty.
Funding the Trust
A trust only works if it is properly funded. Funding a trust means transferring assets such as bank accounts, real estate, investments, business interests, or personal property into the name of the trust.
Assets that are not transferred into the trust are not governed by its terms and may instead be subject to probate.
Why Trust Planning Matters in 2025
Estate planning needs continue to evolve, and trusts play an increasingly crucial role in modern planning. In 2025, trusts are especially meaningful because:
Digital assets are now a major component of estates, including cryptocurrency, online accounts, digital photos and videos, intellectual property, and cloud content. Trust planning helps ensure access, privacy, and ownership continuity.
Long-term care and disability needs are increasing, and trusts can help protect assets while securing care resources.
Blended and non-traditional families are more common, and trusts provide clarity, prevent conflict, and allow for customized distribution plans.
Trusts provide protection beyond wealth, helping families avoid confusion, ease emotional stress, streamline administration, and shield assets when appropriate.
Trusts are no longer tools only for the wealthy — they are thoughtful instruments used by families of all types to accomplish meaningful goals.
Looking Ahead
In our next post, we will explore the differences between revocable and irrevocable trusts and how each can support important planning objectives such as:
Avoiding probate
Protecting assets from lawsuits or long-term care costs
Minimizing tax burdens
Supporting loved ones with special needs
Creating charitable impact
Building generational wealth and stability
Whether you are planning for children, safeguarding a lifetime of hard work, or preparing for the unexpected, a trust can be one of the most meaningful steps toward peace of mind and protection.
Visit Us: 900 Wilshire Drive, Suite 105, Troy, MI 48084
Call Us: (248) 251-1001
Learn More: www.axisattorneys.com