The Concept of a Trust

A trust, like a corporation, is an intangible legal entity (“legal fiction” might be a more accurate term) that is capable of owning property. You can’t see a trust, or touch it, but it does exist. The first step in creating a working trust is to prepare and sign a document called a Declaration of Trust.
Once you create and sign the Declaration of Trust, the trust exists, and you can transfer property to it. The trust becomes the legal owner of the property. There must, however, be a flesh-and-blood person actually in charge of this property; that person is called the trustee. With traditional trusts, the trustee manages the property on the behalf of someone else, called the beneficiary. However, with a living trust, you, the person who creates the trust, can be the trustee and also, in effect, the beneficiary, until you die. Only after your death do the trust beneficiaries you’ve named in the Declaration of Trust have any rights to your trust property.