Menu ${}${SEMFirmNameAlt}${}${SEMFirmNameAlt}
Practice Areas
Let's Get Started!

What are testamentary and inter vivos trust funds?

Trust funds are a great way of compounding and building wealth in the long-term. There are two main types of trust funds, and it can sometimes be difficult to understand the differences between the two. These two types are testamentary trust funds, and living trusts. Living trusts are also commonly known as inter vivos funds, and that can lead to some confusion.

This blog will offer a brief walk-through of both testamentary and inter vivos trust funds, how they work and what the differences are.

What are testamentary trust funds?

Testamentary trust funds are trust forms that are formed after the death of the grantor. The grantor would have usually prescribed that a trust fund should be set up in his or her name within his or her will.

The problems that can occur with a testamentary trust fund is that all assets are likely to go through the probate process. This means that outcomes are likely to arise that were not desired by the deceased grantor.

What are inter vivos trust funds?

An inter vivos trust fund, otherwise known as a living trust, exists during the grantor's lifetime. They may be put into action in various ways. For example, 3 percent of the net worth could be paid out to the grantor's child from the year that he or she turns 18. The benefit of this is that it gives the grantor much more flexibility and control over how the money is used. The trust can be added to over time, from cash assets to, in some cases, real estate investments.

An attorney can help you determine which type of trust suits your needs, as well as other information about estate planning.

Source: The balance, "Testamentary vs inter vivos trust funds," accessed Sep. 01, 2017

No Comments

Leave a comment
Comment Information

Serving businesses and individuals throughout Massachusetts

Waltham Office
375 Totten Pond Road
Suite 200
Waltham, MA 02451

Waltham Law Office Map

Braintree Office
25 Braintree Hill Office Park
Suite 406
Braintree, MA 02184

Phone: 617-523-1555
Braintree Law Office Map

Cranston Office
200 Midway Road
Suite 159
Cranston, RI 02920

Cranston Law Office Map

Hyannis Office
1330 Phinney’s Lane
Hyannis, MA 02601

Hyannis Law Office Map

Norwood Office
520 Providence Highway
Suite 10
Norwood, MA 02062

Norwood Law Office Map

Westborough Office
276 Turnpike Road
Suite 228
Westborough, MA 01581

Westborough Law Office Map

Woburn Office
444 Washington Street
Suite 203
Woburn, MA 01801

Woburn Law Office Map