What Is A Trust?
A Trust is an legal instrument whereby a person, called the grantor or settlor, gives property to another person, the trustee, to be held for the benefit of a third person, the beneficiary. Trusts take numerous forms, and can be created both during your lifetime, and following your lifetime if laid out in your last will and testament.
Revocable (“Living”) Trusts
A Revocable Trust is one where the provisions of the trust can be altered or canceled by the person(s) who created the trust. When the trust creator, becomes deceased the trust shifts to an irrevocable trust and changes can no longer be made.
When planning your estate, revocable trusts offer a number of benefits. First is the ease of which someone else is able to take over and handle your affairs in the event of your incapacity. Second is the ability to avoid probate following your death. And perhaps most important of all is the increased ability to control what actually happens to your estate, even after you pass away.
A irrevocable trust is one, which like the name suggests can not be changed, altered, or discarded after it’s creation. These types of trusts are typically used to accomplish complex estate planning tasks, such as qualifying for Medicaid, or legacy planning.
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