Moneyzine
Contents
/Personal Finance/Executory Trust (Imperfect Trust)

Executory Trust (Imperfect Trust)

Moneyzine Editor
Author: 
Moneyzine Editor
1 mins
September 25th, 2023
Advertiser Disclosure

Definition

The term executory trust refers to an agreement in which there are additional items to attend to before the trustee can fulfill their fiduciary duties to beneficiaries. An executory trust is one in which the settlor, or donor, has not clearly outlined the trustee's responsibilities to the beneficiaries.

Explanation

Also known as an imperfect trust and incompletely constituted trust, an executory trust is any agreement that needs additional attention before it is said to be perfected. This means there remains ambiguity as to the donor's instructions, the trust's beneficiaries, or the assets placed into the trust. The donor / settlor must provide additional instructions, or take some action, before an executory trust can be executed. Until it is perfected, the document is considered provisional only. A trustee cannot fulfill their fiduciary responsibility to protect the assets placed in the trust or carry out the donor's instructions until the document is perfected.

An executory trust can be contrasted with an executed trust, which requires no additional attention of the donor or trustee before it is believed to be perfected.

Related Terms

Related Content

  • What Can Help You Meet Your Budget While Shopping for Important Items?
    Budgeting while ensuring you don't compromise on quality can seem daunting. Whether filling your pantry, updating your wardrobe, or keeping up with the latest tech, smart shopping strategies are crucial for keeping your finances in check.
    April 2nd, 2024
  • How to Make a Million Dollars in 10 Years
    Truthfully, this title should actually be “How to Make a Million Dollars in 10 Years Without Going Into Debt", but that is just getting a little too winded for my liking. It’s true though!
    November 5th, 2024
  • How to Apply Maslow’s Hierarchy to Your Money This Year
    You might vaguely remember your psychology teacher talking about Maslow. He pointed at a picture of a triangle as you nodded off in the back of the school room.
    November 5th, 2024
  • How to Tackle Multiple Savings Goals
    When there’s only so much money to go around, there are often multiple savings goals competing for your money. Think of the young professional who’d like to get a more reliable car, buy a house, and save for retirement. Or consider the young family that’s saving for college, retirement, and a bigger house.
    March 22nd, 2024
  • The Countdown to Early Retirement: 10 Expenses to Eliminate
    Dreaming of waving goodbye to the daily grind five years ahead of schedule? The road to early retirement is paved with more than good intentions; it requires a meticulously crafted strategy with surprising twists. It's not solely about what you should be doing—like diligently saving a portion of your income or investing wisely—but also about what you need to stop doing.
    March 22nd, 2024

Contributors

Moneyzine Editor
The Moneyzine editorial team consists of writers and content specialists with diverse backgrounds.
Moneyzine 2024. All Rights Reserved.