Revocable Living Trusts, Explained in Plain English.

Revocable generally means the person who created the trust may change or end it while they have the legal capacity to do so. Living means the trust is created during that person’s lifetime rather than only after death.

A revocable living trust is often designed to be flexible during life. The person who creates it may also serve as trustee at first, while naming someone else to step in if incapacity occurs.

A trust may provide a framework for managing trust-owned property if you cannot manage it yourself. The successor trustee’s authority comes from the trust terms and applicable law, and the practical details need to be understood before they are needed.

• Identify who may step in and under what circumstances
• Provide directions for managing property and expenses
• Coordinate the trust with powers of attorney and health care planning

After death, a successor trustee may administer and distribute trust property under the written instructions. The process can involve gathering property, addressing obligations, communicating with beneficiaries, and following the trust terms.

A trust may address some property outside probate, but it is not a promise to avoid probate in every situation. Property not properly transferred to the trust, property with a separate beneficiary designation, and other circumstances may call for different treatment.

Funding means changing ownership or otherwise coordinating property with the trust. A carefully drafted trust that is not implemented or maintained may not work as intended. Real estate, financial accounts, business interests, and beneficiary designations each require attention.

A revocable living trust is not a universal solution and generally does not, by itself, protect assets from every creditor or guarantee a particular tax, benefit, or probate result.