Just about anything of value can be placed in a trust, be it blind or revocable. Your trust might consist of physical items such as your house, car and expensive jewelry, as well as stocks, bonds and savings accounts. Assets can be removed at any time from a revocable trust. Blind trusts may be irrevocable or revocable, but the originator may not know what changes the trustee makes to its contents.
In short, a trust is a financial arrangement in which you appoint a responsible trustee to manage the assets of an account. Revocable and blind trusts are both designed to transfer assets to beneficiaries named in the trust documents. The trustee could be a lawyer, a bank, or a relative for either one, but you can't be the trustee of your blind trust. The trustee has total control of a blind trust, and its beneficiaries can't have knowledge of the current status of specific assets. Trusts can get confusing, so many people use an experienced attorney to get it right.
A trust of any kind is usually created to skip probate when its originator dies. Probating an estate can eat up a lot of a beneficiary's time and money, and the trust is an easy way to avoid all of that. A blind trust has the additional bonus of protecting the originator from the appearance of conflicts of interest. For example, someone holding a government position might not want it known that he holds stock in a company his decisions can affect.
As the originator of a revocable trust and usually the primary beneficiary, you can always access information about what assets are in the trust. By definition, the beneficiaries of a blind trust can't do the same. A blind trust is also helpful when the originator wishes to establish it for a beneficiary, but wants the beneficiary to have no knowledge of the assets.
Both a revocable and revocable blind trust can be ended or modified at any time by the originator. Many of the rules for how they function are the same. The trust documents in both types determine how the assets should be distributed to the beneficiaries. This is usually dictated by a will included with the trusts.
- Must Both Grantors Die Before a Revocable Trust Becomes Irrevocable?
- Can Trust Fund Money Be Allocated Monthly?
- What Is the Difference Between a Living Trust and an Estate Account?
- Rights of the Beneficiary of a Family Trust
- Pros & Cons of an Irrevocable Trust
- What Is a Trust Officer?
- What Is a Defective Irrevocable Trust?
- Beneficiaries' Rights to the Bank Statements of Trust Accounts