KISS Trusts and How They Work

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Typically, financial advisors and tax attorneys are just a few of the specialized professionals that you'll need to pay when establishing a trust fund for family members or future benefactors. Most states require that an attorney draft the trust documents—and the attorney fees alone can cost thousands of dollars. For example, in Arizona, the customary fees of a corporate fiduciary is generally 4% on estates up to $200,000, 2% on amounts over $100,000, and a minimum fee of $5,000.

Overall, the need for professional and legal oversight has traditionally made the process of setting up a trust into a time-consuming and expensive one, meaning that unless you have a large sum of money to place in the fund, it may not be worth your time.

Many people are turning to what's called "a KISS Trust", a relatively new, fast, and inexpensive alternative to setting up a traditional trust. It's a good option for people who want to leave money to their loved ones, but don't have millions in the bank.

What Is a Trust Fund?

A trust fund is essentially a legal will with additional, complex stipulations for what money can be withdrawn and what money must be reinvested. This is a strategic result of a trust fund's intended purpose of producing continual revenue for its benefactor(s) over the years or generations to come. Trust funds are used by wealthy individuals, families, and organizations that wish to benefit from the interest and dividends earned by a large sum of money over time.

For example, if you were wealthy enough to start a traditional trust fund of $1 million, you might task a specific bank or wealth management company with investing that money into bonds and stocks that would pay 7% interest each year. That $70,000 could be used to give your three children a steady income of $20,000 each, with the other $10,000 being reinvested so that the trust continues to grow. If maintained properly, this strategy may allow your grandchildren or extended family to receive a payout in the future, as well.

Trust Advantages

One advantage of a trust is that you decide the particulars. You could decree that your children have access to the trust in order to fund their college education, while also specifying that if they choose not to pursue higher education, they can’t draw from it until they’re 40 years-old.

You might add caveats that provide immediate access if any of your children become medically disabled, or that provide a one-time stipend when they purchase a home. As in the case of a legal will, you have control over the decisions concerning your assets, and can make the stipulations of your trust as simple or complex as you see fit.


If you leave money for your family in a savings account, your immediate benefactors will be tasked with making all the decisions.

Trust Disadvantages

Establishing a trust remains financially out of reach for most families, who do not have substantial wealth to leave behind when they die, and who therefore cannot justify paying an attorney and financial advisor to establish and manage a fund.

Estate Planning: By the Numbers

In a 2020 survey of Americans to determine who is engaging in estate planning, data shows that as one’s income increases, the likelihood of having a will, living trust, or advanced health care directive also increases. Just 45% of people in the highest income group said that they have an estate planning document, and 30.4% of respondents said that they do not have a will or living trust because they don’t have enough assets to leave anyone.

Of those who do have estate planning documents, a will is the most common, at 23.9% of respondents, 13% of 2020 respondents said that they have a living trust, and just 6.2% have an advanced health care directive.

A KISS Trust

You can start a KISS Trust for anybody you'd like with a minimum investment of $1,000 (or $50 if you commit to monthly contributions). The cost to establish a KISS Trust is just $199, and you can set up additional, specific trusts for your loved ones at a cost of $99 per account.

This fee includes all required legal documentation. One conservative estimate shows that if you contribute $1000 initially—at the birth of your child, for instance— with an additional $100 every year for 18 years, by the time your child reaches 65, the trust could grow to be worth $315,000. This estimate is made possible through the wonders of compound interest.

With a KISS Trust you can even place a stipulation in the documents that if the person receiving the trust has children, a certain amount will be pulled from the existing trust to set up trusts for each child, and then their children, and so on.

KISS Trusts are held by virtually all Wall Street financial brokerages. The parameters for the type of investments you select for the fund will play a role in determining the chances that it will go bankrupt. It's also not unheard of for pensions, retirement funds, and trusts to disappear in the hands of unscrupulous financial advisors.

Keep in Mind:

Every financial investment has inherent risks associated with growth, and that unless you build flexibility into the trust's financial management, the stipulations you set will carry on indefinitely after your death.

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  1. The American College of Trust and Estate Counsel. "A Survey of State Statutes and Practices Regarding Fees of Executors, Administrators and Testamentary Trustees."

  2. "2020 Estate Planning and Wills Study."

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