| Alan R. Horvath, Attorney at Law |
| Frequently Asked Trust Questions |
| Phone: 209 754-5291 Fax: 209 754-5293 |
| ahorvathlaw@sbcglobal.net |
P.O. Box 81
596 Mountain Ranch Rd.
San Andreas, CA 95249
596 Mountain Ranch Rd.
San Andreas, CA 95249
What is the Difference Between a Settlor and a Trustee?
A settlor is the person who set up the trust. The trust contains the settlor's assets, and it is the settlor who has the
power to revoke the trust.
The trustee is the person who has been given the assets and who is legally obligated to follow the instructions
given in the trust document.
This distinction is confused by the fact that most revocable living trusts are set up with the settlor also being the
initial trustee. This is legally permissible as long as there is a beneficiary other than, or in addition to the settlor.
The distinction between settlor and trustee can best be understood if we imagine a trust where the two roles are
NOT being filled by the same person. Suppose you are in very poor health. You give your brother $300,000 on
the condition that the money be used only to insure that your son gets a college education and gets a good start
on life. This is a trust. You are the settlor, your brother is the trustee, and your son is the beneficiary.
The trust imposes a legal duty upon your brother for him to follow the trust instructions.
A settlor is the person who set up the trust. The trust contains the settlor's assets, and it is the settlor who has the
power to revoke the trust.
The trustee is the person who has been given the assets and who is legally obligated to follow the instructions
given in the trust document.
This distinction is confused by the fact that most revocable living trusts are set up with the settlor also being the
initial trustee. This is legally permissible as long as there is a beneficiary other than, or in addition to the settlor.
The distinction between settlor and trustee can best be understood if we imagine a trust where the two roles are
NOT being filled by the same person. Suppose you are in very poor health. You give your brother $300,000 on
the condition that the money be used only to insure that your son gets a college education and gets a good start
on life. This is a trust. You are the settlor, your brother is the trustee, and your son is the beneficiary.
The trust imposes a legal duty upon your brother for him to follow the trust instructions.
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