The industry's recovery will continue, driven by the aging population and Federal Estate Tax
New York, NY (PRWEB) October 17, 2014
The Trusts and Estates industry is composed of trusts, estates or agency accounts administered on behalf of beneficiaries under the terms of an agreement. In a trust agreement, a trustor or grantor transfers ownership of assets to a trustee, which can be an individual or an institution with a fiduciary duty to act in the best interests of the beneficiaries, such as family members or charity organizations. In contrast to a trust agreement, there is no transfer of ownership in an agency account; instead, institutions are charged with a fiduciary duty to act in the best interests of the principal of the account, rather than those of the beneficiaries. IBISWorld Economic Analyst Leah Goddard says in the updated report, “industry revenue is composed of income generated by the trusts and estates themselves, which primarily include interest payments, dividends, rental payments, royalties and capital gains from the sale of assets.” Industry revenue often fluctuates with financial market trends, which impact investment income, as well as changes in household wealth and the average age of the population, which dictate demand for trusts and estates.
In addition to wills and estate planning, trusts are used for a variety of other purposes, including spendthrift protection, charities, asset protection, tax planning and co-ownership of assets. “Since 2010, rising stock market values have helped bolster industry revenue, while higher household wealth and the aging of the US population has led to the creation of more trusts and estates,” Goddard says in the updated report. For these reasons, industry revenue is expected to recover at an over the five years to 2014. Increasing stock market values, interest rates and household wealth is anticipated to drive industry revenue up in 2014.
Moving forward, the Trusts & Estates industry is expected to benefit from legislation raising the federal estate tax exemption to $5.3 million in gross assets at-death and lowering of the maximum tax rate to 40.0%. Over the next five years, the aging of the US population and the growing number of wealthy households are anticipated to increase industry assets, while rising stock market values and interest rates boost investment income. As a result of these trends, industry revenue is forecast to grow over the five years to 2019.
For more information, visit IBISWorld’s Trusts & Estates in the US industry report page.
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IBISWorld industry Report Key Topics
The Trusts & Estates industry includes personal trusts, estates and agency accounts that are managed on behalf of beneficiaries under terms of a trust agreement, will or agency agreement. Industry revenue is defined as the income generated by the assets in the entity. This may be in the form of interest, dividends and other investment income. This income may be held by the entity or distributed to beneficiaries. Fees for estate planning or drafting wills are not included in this industry’s revenue.
Key External Drivers
Industry Life Cycle
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Globalization & Trade
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