Glossary of Terms: T

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Estate Planning has its own vocabulary. To help you speak the language, we've created a glossary of the more commonly used words and phrases. This glossary is comprised of 26 individual pages, one for each letter of the alphabet. To find a particular word or phrase that starts with the letter "T" - simply scroll down the list below. If your word or phrase starts with another letter, please use the alphabet index below.

Testamentary Trust

A "testamentary trust" is a trust that is created under a Last Will and Testament. As such, a testamentary trust does not become effective until the Testator dies and the will is admitted to probate. See "living trust."

Testate

The term "testate" means having made a legally valid will before death. See also "intestate."

Testator or Testatrix

Historically, the term "testator" refers to a man who has made a legally valid will before death, while the term "testatrix" refers to a woman who has made a legally binding will before death. While these terms are still used in many legal circles, the tendancy today is to use the term "testator" for both men and woman.

Trust

In a legal sense, the term "trust" refers to the relationship between two (or more) parties whereby one party holds legal title to property for the benefit of another.

Trust agreement

A "trust agreement" is a written agreement between two or more parties that creates a trust, wherein one or more parties are the creator(s) of the trust and one or more other parties are the trustee(s).

Trust instrument

The term "trust instrument" refers to the written document that creates a trust. When a person creates a revocable living trust and names himself or herself as the sole trustee, then the trust instrument is called a “declaration of trust” because the grantor is simply declaring his intentions to the world. When someone other than the grantor serves as a trustee, then the trust instrument is called a "trust agreement" because there is an agreement between two (or more) parties.

Trustee

A "trustee" is a person or entity appointed or required by law to execute a trust. In a strict legal sense, a trustee is a person or entity that holds legal title to property for the benefit of another. For example, Sam and his wife have a son, Jim, who is 17. Sam and his wife are going to Europe for three months and Jim is going to stay with Sam’s sister, Mary. In order to pay for Jim’s expenses, Sam gives Mary $1,000. Although there is no written agreement, a trust is created between Sam and Mary, nonetheless. Sam is the grantor, Mary is the trustee, and Jim is the beneficiary. Mary has title to the $1,000 but she must use it for Jim’s benefit. Because Mary has accepted the $1,000 under the condition that she hold it and use it for Jim’s benefit, she is the "trustee." of the trust created by Sam. See "fiduciary."

Trustor