Understanding Blind Trusts: Benefits and How They Work

A blind trust is a type of estate planning tool that can be used to provide funds for beneficiaries. With this type of trust, the beneficiaries have no idea what is actually being held in the trust. They receive the assets in the trust at the proper time, but they will not know what they are receiving in advance.

How it Works

The trustee and the grantor are the only ones that know what is being held in the trust. It is up to the trustee to handle the assets in the trust in the proper manner. When the grantor of the trust passes away, it is the trustee's job to pass the assets on to the beneficiaries of the trust. This type of trust is generally used when a grantor wants to provide certain things for a beneficiary without them knowing. They do not want to create a scenario in which the beneficiary has a conflict of interest to deal with.

Using a blind trust is an estate planning tool that is often used by parents who want to keep their kids from knowing what is coming to them. This way, any disputes can be avoided.