While it likely isn’t the first thing to come to mind when we think about estate planning, assigning a proper name for any trusts you create is just as important as any other part of the process, including drafting the documents themselves.
Why Does A Trust Need A Name?
One question that may first arise is why does a trust even need a name? It seems trivial and honestly, unnecessary, however, for a trust to hold title to certain assets, it must have an identifiable and formal name.
What Are My Options?
Attorneys usually recommend including the family name in the title and keeping it as short and simple as possible. This may not be a particularly creative approach, but at least you’ll be able to easily discern exactly what the trust entails, which arguably is the most important part of naming your trust. While it is common to use the “family” in a trust, it is not a requirement. As long as it can be identified, you can name it anything you want. If you do not want to include your name for privacy reasons and just want to transfer property to the trust, one option is to name the trust after the street on which the property is located. It’s also common to add the date that the trust was signed into effect as another way to identify the document (remember, short and simple, just the year will do). If you have more than one trust with relatively similar names, this approach is recommended so that you can quickly and easily identify the trust and distinguish it from the others.
Other Possible Names
Trusts can also be named for their purpose. You could have a dividend trust where the money left for your children must be put into dividend stocks and can only be distributed in full on a specified birthday. An appropriate name for this trust can be “The John Smith II Dividend Trust”. Let’s say you want to have a trust specifically used for someone’s college tuition. The trust can be named “The John Smith Educational Trust”. If you want to create a trust for a charity, the ASPCA for example, the trust can be named “The ASPCA Charitable Trust”. In the interest of privacy, you may want to avoid using your name altogether and use a generic name instead. This could be helpful in the case that a creditor is seeking out your assets, since it will be harder for them to find something that cannot be traced back to your name.
While naming your trust is generally not reason to consult an attorney, drafting your estate plan certainly is. If you or a loved one are looking to create a proper and comprehensive estate plan, we highly recommend that you seek out a licensed estate planning attorney. Only a licensed professional can make sure that your estate plan makes it so that all of our assets are seamlessly distributed in accordance to your last wishes after your death.