What Does Testamentary Trust Mean?
A testamentary trust is a trust arising from a testator’s death designating a certain amount or a certain property to be held by another person (the trustee) for the benefit of another (the beneficiary). A trust is an arrangement wherein one person manages the title to a property for the beneficial use of another.
Insuranceopedia Explains Testamentary Trust
An example of a testamentary trust is when a parent creates a testamentary trust in their will to leave a certain sum of money deposited in a bank for the educational benefit of their youngest son. In that trust, the parent might specify the release of funds from the trust to begin as soon as the son is 16 years old, with periodic releases every year until he finishes his college schooling, with the full balance to be given at the age of 25.