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What are trust companies?

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Quick Answer

A trust company is a legal entity owned by a bank or other financial institution, law firm or independent partnership that manages trusts, trust funds and estates for individuals, businesses and other entities, explains Investopedia. A trust company acts in a fiduciary capacity as trustees for their clients.

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Full Answer

Trust companies manage a wide variety of trusts, including living trusts, testamentary trusts, revocable and irrevocable trusts, retirement accounts, and charitable trusts, according to Investopedia. A trust company services its clients' investment needs and streamlines the investment process by offering a number of services that clients would otherwise need to coordinate between brokers, financial planners, tax advisers, tax preparers and attorneys to attain.

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