Executor vs. Trustee
Difference between executor and trustee: – When it comes to know and understand the difference between executor and trustee, then we should know that first what is executor and what is trustee? Executor are probably those people who executes or implements the plan of paper work into the real shape, while on the hand trustee are those people, who give financial support to implement the plan.
Difference between Executor and Trustee
Just like many other terms, when talking about the difference between Executor and Trustee, it is necessary to understand a few initial conditions to get a definite understanding of these terms. The first term is trust, which means to hold and to use the investments for the beneficial purposes to the people who grant the “ownership” of the assets into the trust. Such people are known as grantors.
The trustee is the person who deals with the trust. In other words, think of the trustee as someone who manages the moving property entrusted to him by the grantors for the beneficial interest of the beneficiaries of the trust. He is full control over the trust and can transform the conditions of the trust like the various sections, including the will.
Most of the times, the beneficiaries are actually the grantors of the trust, and there is absolutely no reason that the grantors and beneficiaries of the trust cannot be the Trustee. For instance, suppose two partners, Mr. Bill and Helen wanted to build a revocable living trust. So, ultimately, Bill and Helen are the grantors but they can also reshape their investments into revocable living trust. This trust would now operate as a legal entity that is the owner of the belongings in their recently formed Bill and Helen Revocable Living Trust. Furthermore, Bill and Helen can, and will, become the trustee of the Bill and Helen Revocable Living Trust. They can also include even more investments into and from the trust, change beneficiaries, change the conditions of the will, etc.
Suppose that Mr. Bill passed on, leaving Helen as the trustee of the property. Instead, he would be known as the Successor Trustee of the property. So, both Bill and Helen would be each other’s successor trustee, in case the other one dies, for the intended purpose of carrying on the management of the Bill and Helen revocable living trust.
However, have you ever given a thought to what would happen if both Bill and Helen passed on? Then, who would be looking after the Bill and Helen revocable living trusts? Now, here comes the scenario where the Bill and Helen Revocable Living Trust does not have any Trustee. In simpler words, there is just no one managing it.
Inside the Trust documents, there can also be a person mentioned somewhere in the documents, as an Executor. That is typically somebody who is supposed to “execute” the conditions of the entrusting it to their children, grandchildren or favorite charity. This may be any beneficiary who’s called in the trust documents to be always a receiver of the property within the Trust.
This happens when the Trustee or Successor Trustee dies and because there needs to be someone managing the trust, so the conditions of the trust need to be executed and allocated to the called beneficiaries. That’s just how these Trusts operate; however, the nuances of every trust may become complicated depending on the size of the property and other trusts or financial matters that exist beyond the trust conditions.
Now it should be clear in your mind what is executor and what is trustee and what are the differences between both of them. Again here I want to mention that executor implements the plan and trustee provides financial support to the executors.