Get quick answers to frequently asked questions here.
What is a Trust?
A Trust is a legal contract/relationship where you (the Settlor) transfer assets to a legal entity, the Trust, which will be administered by a Trustee (such as Quantum Zenith Trustees or an individual) for the benefit of a beneficiary (which could be yourself or another person).
Trusts are separate legal entities, like companies, whose purpose is to hold and manage assets for you or for the benefit of others.
What is a Trust Deed?
The Trust Deed is the document executed between the Settlor (You) and the Trustee and it outlines how, when and to whom your assets will be distributed, in accordance with your wishes.
What can Trusts Do for You?
• Ensure the orderly and private transfer of your assets/wealth/property.
• Safeguard the process of providing for loved or vulnerable ones-children, parents or wards.
• Help set up a structure to finance a child’s or ward’s education.
• Manage your Estate Tax exposure.
• Legally avoid Probate costs.
• Legally shield assets from creditors’ claims.
• Provide a structured way to administer your personal and financial affairs should you become ill or otherwise incapacitated.
Who are the parties to a Trust?
In all Trust arrangements, there will be 3 separate parties to the Trust-The Settlor, the Trustee and the Beneficiary.
• The Settlor is the benefactor i.e. the creator of the Trust, who transfers the assets to the Trustees.
• The Trustee is the one to whom the Settlor transfers the assets to hold in Trust for the beneficiaries. Legal ownership will pass from the Settlor to the Trustees but beneficial ownership resides in the beneficiary.
• The Beneficiaries are the persons who are entitled to use or enjoy the income or assets of the Trust.
What are the advantages of a Trust?
• With a Trust, you can name one or more beneficiaries to receive your assets at your demise, just like a Will, but in this case, you legally avoid probate expenses. Probate Expenses and Estate Taxes can become excessive, making the assets inaccessible to your loved ones/beneficiaries. Trusts can provide for the tidy transfer of property without the expense, delay, or publicity of probate, and for professional asset management for beneficiaries.
• A Trust can endure beyond your lifetime, becoming a source of lasting income and upkeep for your spouse, a child or others whom you choose.
• A Trust will guarantee succession of property- By gifting assets to a trust, the Settlor is ensuring that the assets he is giving away remain within his family. For example, a Settlor can create a Trust for the benefit of his wife and specify in the Trust Deed that on his wife’s death, the assets will pass directly to his children or grandchildren. This prevents his wife from disposing of the Trust Property to a non-family member.
• The details of a Trust are, by nature, private, as opposed to a Will that can be easily accessed by the Public at the Probate Registry. Trustees are also required by Law to be discreet about all aspects/details of a Trust.
• A Trust can make provisions for a spouse, spouse from a previous marriage or children from previous marriages while keeping assets within the Settlor’s family.
• An Education Trust, which is different from an Education Savings Plan, can help with providing for the education of in-school beneficiaries upon the event of the demise of a Settlor. An Education Trust can either be a Stand-Alone Trust or it may be incorporated into a larger Trust. Quantum Zenith Trustees has designed the ZETPLAN for this purpose.
• If your assets are transferred into a trust during your lifetime, those assets will not be subject to claims after your demise from family members or others whom you do not wish to share in those assets.
• In the event of the Settlor’s demise or incapacity, a Trustee (such as Quantum Zenith Trustees) will guarantee that the aims of the Trust as specified by the Settlor are realised.
• The Trust is separate from your estate and is therefore sheltered from creditors.
• The designated beneficiaries automatically receive the accumulated benefits even in the event of your demise, without recourse to a Will or Letters of Administration.
What constitutes Trust Assets?
Cash, Money-in-Bank, Stocks, Real Estate assets, Personal belongings, Jewelry, Vehicles etc.
What are the characteristics of a Trust?
• The Trust assets are separate and are not part of the Settlor’s Estate.
• Title to the Trust assets stand in the name of the Trustee.
• The Trustee has the power and duty to manage, employ or dispose of the assets in accordance with the terms of the Trust Instrument as stipulated by the settlor.
What types of assets can you put in a Trust?
• Stocks and Bonds
• Real Estate (including Land)
• Mutual Funds
• Intellectual property
• Bank Accounts, Safe Deposit boxes
• Notes payable (money owed to you)
• Life insurance (or use irrevocable trust)
What are our duties as Trustees?
Our duties include to:
• To comply with the terms of the Trust Deed
• To act fairly between the beneficiaries
• To ensure that we do not put ourselves in a position where our interests conflict with those of the beneficiaries. For example, we will not buy any Trust Property if it was for sale
• To take reasonable care in making investments. We will consider the suitability of any investment and the need to diversify.
• To protect Trust Assets
• To insure where necessary
Unless trust documents state otherwise
• Ensure proper transfers of title of assets to be transferred into the Trust.
• Invest the Trust Property for the benefit of the Beneficiaries.
• Maintain detailed records of all assets and transactions.
• Review assets regularly for quality and performance.
• Ensure that payment and distributions are made to genuine Beneficiaries.
• Facilitate final transfer of Trust assets to the eventual owners i.e. Beneficiaries.
How do we charge?
Generally, fees for Trust services are spelled out in the Trust document. Under normal circumstances, they are calculated annually, based on the level of responsibility assumed by the Trustee and the value of the assets in the Trust. At your request, we will forward a schedule of fees to you.
Is it difficult to set up a trust?
No. You should start by discussing your financial and investment goals with us.
How are the trust assets invested?
Ultimately, it is the purpose of the Trust that determines how the assets are invested, and it is the responsibility of the Trustee to see that the purpose is carried out. Often, Quantum Zenith Trustees will work with a professional investment manager who will make investment recommendations based on the goals of the Trust, the needs of the beneficiaries and the time horizon.
Do i have to give up control if i set up a trust?
No. You do not have to give up control when you create a Revocable Living Trust. You keep as much control as you want. Typically, the creator of a Revocable Living Trust stays in control by retaining the power to do one of the following:
• Withdraw or Add to the Trust assets
• Change instructions to the Trustee by amending the Trust agreement
• Cancel the Trust all together
Do i have a enough money for a trust?
Trusts are variable and can be revised to cater to an assortment of wishes, situations and goals. Many people still wrongly believe that Trusts are only for the wealthy. Here at Quantum Zenith Trustees, the majority of our customers do not classify themselves as wealthy, they do not have multi-million Naira Trusts. Whether you need to safeguard a retirement portfolio, or need assistance with your Estate Planning, you should consider our services.
Why should i pick quantum zenith trustees as my trustee?
In addition to possessing professional Estate Planning competences, we know how to take care of all Investment details since we are affiliated to an assortment of Investment and Wealth Management companies. We are therefore that One-Stop shop you’ve been searching for.
Is a trust expensive?
No. As you can see, our annual charges as Trustees are less than you were previously paying for Investment Advice or Wealth Management services.
What is a living trust?
Settlors often create a Trust where they act both as Settlors and co-Trustees. While Settlors are alive, they can continue to control all assets in the Trust because they are Trustees of their own Trust. He can also continue to be the beneficiary of all assets and income from the Trust. When the Settlor dies or becomes disabled, the Trust will name the successor Trustees (Quantum Zenith Trustees) who are given power and authority over the assets by the terms of the Trust Deed. A Living Trust is sometimes referred to as a Will Substitute. It is also called a Revocable Living Trust because it can be amended, changed or revoked by the Settlor during his lifetime.
What is meant by "funding" the trust?
In order for a Living Trust to control your assets at the time of death or disability, all assets need to be titled in the name of your Trust. Funding your trust is the process of transferring your assets from you to your trust. To do this, you physically change the titles of your assets from your individual name (or joint names, if married) to the name of your trust. You will also change most beneficiary designations to your trust. The process of changing titles and beneficiary designations is what is referred to as “funding” the Trust.
To transfer cash or securities, Quantum Zenith Trustees will open an account in the Trust’s name, and the Settlor will instruct his or her bank or broker to move the funds from his or her account to the Trust’s account. For real estate, a deed is used to transfer legal title of the property from the Settlor to the Trust. All future insurance and property tax statements should be sent to Quantum Zenith Trustees and paid with Trust funds. Finally, to transfer an existing life insurance policy, the Settlor simply needs to obtain and complete a change of ownership form and change of beneficiary form from his or her life insurance company.
Can i do my own Trust Funding?
Funding a Trust is complicated and requires in-depth knowledge of Law, Finance, Forms, Deeds, Titling, Real Estate and the proper conveyance instruments. It is better to leave the hard work to Quantum Zenith Trustees.
If i have a living trust, do i also need a will?
If you have a Living Trust-based plan, you will still want to have a Pour-Over Will. Your Pour-Over Will does two things. First, it names guardians for minor children. Second, the Pour-Over Will assures that any assets that were not re-titled into the name of the Trust will pass through probate and into the Trust for proper distribution to loved ones.
What is a Pour-Over Will?
A Pour-Over Will is a Will established by a Settlor who has already taken the necessary steps to set up a Trust, so that upon the death of the Settlor, all of his or her assets are to be transferred – or “poured over” – to the Trust.
What happens if my Trust is not funded?
The Trustee can only control assets titled in the name of the Trust. If assets are not in the Trust at the time of death or disability, the Trust will not effectively pass control of the assets to the person or persons that you have designated in the Trust. This means that assets might go through probate at your death. A pour-over will can provide a “safety net” for your Trust, but we recommend full and continuous funding of your Living Trust.
What happens to a Trust after the Settlor dies?
By Law, Trustees have the responsibility to follow the instructions in the Trust. This is called a Trustee’s fiduciary duty. The property and assets in the Trust are distributed to family members or distributed into one or more new Trusts (like the Education Trust) for the benefit of family members. In addition, the Trustee is required to satisfy creditors of the estate of the deceased Settlor, file income and estate tax returns, manage and liquidate assets, provide an accounting to beneficiaries and generally wind up the affairs of the person who has passed away. We call this process post-mortem Trust administration.
Is the Trustee Subject to any Rules or Regulations?
The Trust Deed sets out the scope of a Trustee’s powers. Quantum Zenith Trustees are also subject to a variety of other requirements imposed by the Securities and Exchange Commission.
Importantly, a Trustee has a fiduciary relationship with the beneficiaries. This relationship exists because of the Trust placed in the Trustee. To protect those in a vulnerable position (those putting Trust in the Trustee) the law recognises this special relationship and places duties on the Trustee to ensure they act in good faith and the best interests of the Trust.
Can a Trustee Also be a Beneficiary of a Trust?
Yes, a Trustee can be one of the beneficiaries of a Trust. For example, an individual could set up a Trust, appoint themselves as Trustee and distribute income to their family. However, a Trustee cannot be the sole beneficiary of a Trust. This is because they would be legally owning property for the benefit of themselves.
Can I Transfer Property I Already Own Into a New Trust?
Yes, you can. It is noteworthy though that the transfer of property into a Trust will generally be classified as a sale and this will attract Stamp Duty and perfection costs.
Why choose Quantum Zenith Trustees?
There are several advantages to naming Quantum Zenith Trustees as Trustee. Unlike other providers of Trust services, our skilled Trust advisors deal exclusively with Trust issues. The solutions our Trust experts provide are never “one size fits all,” but are individually tailored to fit personal needs.
In addition, Quantum Zenith Trustees offers:
• Professional management by trained experts
• Impartiality in making investment decisions and in dealing with beneficiaries
• Quantum Zenith Trustees’ commitment to placing our clients’ interests first and serving them with integrity, innovation, quality and hard work
• The confidence that comes from knowing your Trustee is subject to regular audits by external auditors and government regulators(Securities and Exchange Commission)
How can I find out more about your Trust Services?
Our Trust staff will be glad to assemble further information for you, analyse your trust requirements and answer questions not covered here. Please e-mail us at service@quantumzenithtrustees.
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