Before determining that a revocable living trust is the right fit for you, you should evaluate several factors. The term “living trust” may be exchanged with “revocable trust”. This means that you create it during your lifetime and that you can change it during your lifetime as well. The living trust, when used properly, can help you manage assets or protect you in the event that you become ill or disabled. Since you have the power to revoke or change them, you should be aware that the tax advantages available with some trusts are not the same in this scenario. These trusts, however, can help you avoid probate.
The use of irrevocable living trusts, however, does allow that you can gain asset protection or tax advantages because you are not taking over the power to revoke or change the trust.
More than likely, you’ll be the trustee of the trust while you are still alive, and those powers will transfer to another trustee in the event of your death. This second trustee might either distribute the property or continue managing the property for the beneficiaries. A living trust can allow for distribution of your property at death, but it is not the same vehicle as a will. Unlike a will, a living trust gives you the power to manage property while you are still alive and gives a trustee power to manage it in the event you become incapacitated. To learn more about the different types of trusts, please contact us at (601) 925-9797.