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How does a revocable living trust work?

On Behalf of | May 3, 2024 | Estate Planning |

A revocable living trust is popular with many people making their estate plans due to its flexibility. This kind of trust allows you to transfer your assets to the trust during your lifetime. However, you still retain legal ownership of the trust assets.

Revocable living trusts are ideal if you want to be in control of the trust and its assets. You can change the terms of the trust, remove or add assets and beneficiaries or even revoke the trust whenever you wish. As the grantor, you can also appoint yourself the trustee of the revocable living trust, managing the assets just as you did before you put them in the trust.

What happens if you die or are incapacitated?

With a revocable living trust, you can name a successor trustee or rake over management of the trust if you become incapacitated or pass away. In most cases, a revocable living trust becomes irrevocable after the grantor’s death, which means its terms cannot be changed. The trust will be managed according to your instructions.

The benefits of a revocable living trust

One of the key benefits of a revocable living trust is avoiding probate, which can be expensive and time-consuming. Assets in a revocable living trust pass to your beneficiaries without going through probate.

In addition, a revocable living trust puts you in charge. Unlike an irrevocable living trust, where you cannot amend anything or remove assets once it’s created, you can change anything to do with a revocable living trust as long as you are mentally competent.

There is also the element of privacy. You do not have to put up with unwanted public attention, which may happen during the probate court process. Only your beneficiaries and trustees need to know the details of your revocable living trust.