active trust

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Sure! Let's break down the term "active trust" in a way that's easy to understand.

Definition

Active Trust (noun): This is a type of trust where the person managing the trust (called the trustee) has specific responsibilities they need to carry out. This means they must actively do things to manage the trust and help the people who benefit from it (called beneficiaries).

Usage Instructions

• Context: You will often hear "active trust" in discussions about law, finance, or estate planning.
• Who uses it: Lawyers, financial advisors, and people dealing with inheritances or investments may use this term.

Example

• "In this active trust, the trustee is required to invest the funds wisely and provide regular updates to the beneficiaries."

Advanced Usage

• In legal discussions, "active trust" might be contrasted with "passive trust," where the trustee has fewer responsibilities and simply holds the assets without needing to manage them actively.

Word Variants

• Trustee: The person who manages the trust.
• Beneficiary: The person who benefits from the trust.
• Trust: A legal arrangement where one party holds property for the benefit of another.

Different Meaning

"Active trust" is mainly used in legal and financial contexts. However, outside of these fields, "trust" can also mean having confidence in someone or something, but that is a different use of the word.

Synonyms

• Fiduciary duty: A legal obligation of one party to act in the best interest of another.
• Managed trust: Another way to refer to a trust that requires active management.

Idioms and Phrasal Verbs

• "Put your trust in someone": This means to believe that someone will do the right thing.
• "Trust in the process": This means to have confidence that a series of actions will lead to a good outcome.

Summary

So, "active trust" refers to a trust arrangement where the trustee has specific duties to perform for the benefit of the beneficiaries.

Academic

Noun

1. a trust in which the trustee must perform certain duties