A client recently came to our office after moving to New York from a state where real estate deals often use a “deed of trust.” He was confused by the term and wanted to know how it related to setting up a trust for his children. The confusion is common. While the terms overlap, their functions in New York are distinct—a critical difference for anyone planning their legacy.
The person who creates a trust is its architect. This individual is known as the trustor, grantor, or settlor. In my practice, I most often use “grantor,” but all three terms refer to the person who intentionally transfers assets into a trust for the benefit of someone else.
The Grantor: Architect of a Legacy
Placing assets into a trust is not a passive act. It is a deliberate transfer of property and control. As the grantor, you define the trust’s purpose, set its rules, and choose the people who will carry out your wishes. You decide who the beneficiaries will be—your children, a charity, a relative with special needs—and under what circumstances they will receive the assets you have set aside.
You also appoint the trustee. This is perhaps the most important decision a grantor makes. The trustee is the custodian of the assets, the person or institution bound by a profound legal and ethical obligation—a fiduciary duty—to manage the trust exactly as you directed. The grantor’s instructions, outlined in the trust document, become the trustee’s playbook. You determine how much discretion the trustee has, what investments are prudent, and when distributions should be made.
This is an immense responsibility. You are not just signing documents; you are designing a structure intended to outlast you, stewarding assets for the next generation.
Revocable vs. Irrevocable: The Grantor’s Control
A key decision for every grantor is whether to create a revocable (living) trust or an irrevocable trust. The choice has significant implications for control, asset protection, and tax planning.
With a revocable trust, the grantor retains significant power. In most cases, the grantor, trustee, and beneficiary are the same person during the grantor’s lifetime. You can amend the terms, add or remove assets, or dissolve the trust entirely. The trust is a contingency plan—a vehicle for managing your affairs if you become incapacitated and for transferring assets outside of the Surrogate’s Court probate process upon your death.
An irrevocable trust is different. Once you, as the grantor, transfer assets into an irrevocable trust, you generally cannot take them back. You relinquish control. Why would anyone do this? For specific strategic reasons, often related to asset protection from creditors, managing long-term care costs, or sophisticated estate tax planning. The decision to make a trust irrevocable must be made with a clear understanding of what you are giving up.
New York law is precise about how these instruments are handled. Under Estates, Powers and Trusts Law (EPTL) § 7-1.19, a revocable trust can be amended or revoked by its creator, but the change must be in a writing executed and acknowledged in the same manner required for a conveyance of real property to be recorded. This formality underscores the gravity of the document and the grantor’s intentions.
The Trustor’s Role in Context
To return to my client’s original question about a “deed of trust”—that term is most often used in other states as a substitute for a mortgage. It involves a borrower (the trustor), a lender (the beneficiary), and a neutral third party (the trustee) who holds title until the loan is paid. While it uses the word “trust,” its function is financing, not generational estate planning.
In our work with families in Manhattan and across the state, the focus is on the grantor’s role in creating a trust for legacy purposes. The “trustor” is the person with the vision. They identify what they want to protect, whom they want to provide for, and how their values should be reflected in the management of their wealth. The trust document is the legal manifestation of that vision.
Understanding your role as the grantor is the first step. The next is to articulate your specific goals. Before we draft any documents, I ask clients to prepare a simple list of their primary objectives—who they want to benefit, what concerns they have, and what kind of legacy they hope to build. That list becomes the foundation for our work together.
