grantor retained annuity trust
- A type of irrevocable trust where the person who creates the trust keeps a fixed income from it for a specified timeframe, followed by the trust's assets being given to the named beneficiary
- To help in minimizing estate taxes, a parent might set up a grantor retained annuity trust for their children.
- The grantor retained annuity trust allowed the individual to receive a steady income for a decade before the rest of the trust's assets were transferred to their niece.
- The financial advisor recommended a grantor retained annuity trust as a beneficial way to maintain an income stream during retirement while also providing for a grandchild's future.
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