Personal trusts

A personal trust allows you to specifically define how your wealth and assets are transferred to your family or other beneficiary. How can you use a personal trust and what options do you have?

A personal trust can help you establish a legacy.

With a personal trust, you transfer ownership of your assets into the trust, continue to enjoy them, and define what happens to those assets under certain circumstances or upon your death. It is a legal structure.

A personal trust can help when you have a more complex estate or if you want to define plans and limitations for beneficiaries. There are a variety of trusts and gifting strategies that can help you:

Minimize your estate tax liability

Distribute inheritances as you desire

Allocate your wealth between heirs, third parties, and charities

A trust enables you to specify exactly what you want to do with every asset, and when you want to pass it along. You can:

Name a trustee or custodian to carry out the trust’s terms

Control exactly what happens to your assets

Specify how inheritances are distributed (for instance, limiting a young person’s access or specifically paying for their education)

Outline steps to take if you become incapacitated

Protect something you treasure in a divorce

Avoid or reduce estate taxes as well as the time and cost of probate

Take the burden of decision-making off your family

A personal trust can help meet your specific needs and wishes.

Trusts offer more flexibility and customization for estate planning than a will. With a will, your wishes may not be followed exactly, and a will is also part of the public record. Trusts, on the other hand, let you set guidelines and requirements for how your wealth and property gets distributed. Because they do not go through probate, they are private. And trusts aren't just built for the needs of your loved ones—they can benefit your current and future needs, too.

Among other benefits, trusts can:

create a plan for using and enjoying the assets you have,

provide financial security if you become ill and can’t take care of yourself,

ensure the proper care of minors or disabled family members,

encourage responsible behavior by future generations (e.g., requiring your child to complete higher education to receive their inheritance),

fund charitable causes efficiently, and

provide a level of privacy that a will alone can't.

You have options for a personal trust.

Multiple strategies can help keep your taxes low and your distributions fair.

Charitable giving: Support causes you're passionate about through tax-deductible charitable gifts.

Dynasty trust: Help avoid or minimize estate taxes by determining defined distributions for each generation of your family.

Work with Principal^® to establish your personal trust.

Principal Trust Company^® provides trust, custodial, and administrative services for more than 30,000 accounts with more than $424 billion in assets under administration.

You'll find support in our unbiased, experienced team of trust professionals. After discussing your financial goals, we’ll walk you through your trust options and offer options for attorneys who can help you craft a tailored estate plan that includes a personal trust.

We administer our trusts under Delaware state laws, which provide unique advantages not available in other states. These include asset protection, state-level taxation exclusions, privacy, and confidentiality. You don't have to be a Delaware resident to enjoy this benefit.

Talk to your financial professional to explore your trust options, or call us at +1-800-332-4015.