What is a Testamentary Trust?

A testamentary trust is a trust that acts very similarly to a will. Essentially it is a trust inside a will and sometimes is even referred to as a will trust. The trust is created upon the death of the grantor, who is the person by whom the trust has been created. Testamentary trusts are different from other trusts, because they are not created or exercised until after the testator is deceased.

The Purpose of Testamentary Trusts

Testamentary trusts are most commonly used by a person or couple who has young children and a large inheritance or insurance policy that would be inherited if the grantor were to pass away. At the time of death, the trust would be created and effectively manage the inheritance to the children. This allows the case of a minor inheriting a large sum of money to be avoided.

It might be even be undesirable for the children to inherit a large sum of money at 18, at which point the children would be legal adults. The testamentary trust allows you the option to decide exactly when your money is given out. If you wanted to the money to be given out in installments at different ages or at the completion of certain actions, it can be managed in this way by creating a testamentary trust.

Contact Us

If you need help creating a testamentary trust, we can help you through the process. For more information or a to schedule an initial consultation, contact the Austin probate lawyers of Slater, Kennon & Pugh LLP at 512-338-1100 to speak with a trusted attorney today.