Trust Situation paper Assignment Example | Topics and Well Written Essays - 750 words

Trust Situation paper - Assignment Example Not until this is achieved that one will receive an annual income from the fund. Before this time the trustee (may be a bank), manages the fund in a manner appropriate to the trust funds specifications. After this time, the beneficially will usually receive allowance may be for living expenses and or educational expenses (Matthews, 2006). A trust may be revocable or irrevocable. A revocable trust provides for any modification or termination without the permission of the beneficiary. After grantor, has transferred all or part of his assets into the trust, he as from that effect withdraws all his rights of ownership from the assets and the trust. Mr. Raymond has a recoverable Trust, this means that he can alter the terms of the trust or even terminate it without consultation with his children who are the beneficiaries of the trust. A recoverable trust allows the grantor to change the terms of the trust or take the property back at any time (Hayton, 2005). This is not in accordance with the interest of the beneficiaries, and therefore it raises concern to the children of Mr. and Mrs. Raymond. (2) In harmony with the terms of the agreement, the trustee will distribute benefits to the trust beneficiaries or as per the orders from the grantor who can at any time change the terms of the trust. The trustee (bank) as the holder of the property is all times required to act in the best motive of maximizing the trust benefits. This responsibility of loyalty to clients is referred to as a fiduciary obligation, and it places a high reliance standard of care and expectations upon the trustee (bank) (Matthews, 2006). The copies of the bank statements indicate that there have been massive withdrawals for the trust by Mr. Raymond although the trust investment has been positive. This can be attributed to the manner in which Mr. Raymond has been spending on the many trips he takes to visit his children and also for leisure overseas. When the trust funds are