Trust Accounts

What this video covers

• The fiduciary role of the trustee, and why the duty runs to beneficiaries rather than to the grantor or the trustee themselves
• The distinction between a grantor (also called settlor), a trustee, and a beneficiary, and what each party actually does in a trust relationship
• Why revocable trusts do not reduce estate taxes, since the grantor keeps control and the assets remain in the taxable estate
• Why irrevocable trusts provide estate tax benefits, because the grantor permanently gives up ownership and control
• The exact chronological steps a broker-dealer must follow: obtain the trust document, review it for trading authority and restrictions, then open the account
• What the trust document specifies: who can direct trades, investment restrictions, beneficiary identities, and income versus principal distribution rules
• Who may direct trades in a trust account: only the trustee or individuals specifically authorized in the trust document, not the grantor or beneficiaries