What is a Revocable Trust?
Revocable Living Trust
A Revocable Living Trust is a trust that can be amended or altered at any time. They differ from Irrevocable Trusts because they are more flexible and allow the grantor to change its terms and contents. The key word in Revocable Living Trust is ‘living’. A revocable trust is active and can be changed at anytime. Since they are so flexible and subject to change, they are not exempt from estate taxes like Irrevocable Trusts are. Revocable Trusts can be changed through trust amendments or they can be completely redone through trust restatements. Trust amendments are used for small changes to your trust, such as getting rid of a single bequest or changing a beneficiary’s legal name after they get married. A restatement is used for major changes such as removing a beneficiary or if you decide to leave your assets to a charity rather than family members. A Revocable Trust is not just for properties and money. You can transfer insurance, stocks, bonds and other assets into your Revocable Trust.
Why use a Revocable Trust?
Revocable Trusts are a good choice if you (the grantor) are preparing and planning to deal with your own mental illness or disabilities in the future. If your assets are in a Revocable Trust than, if needed, they can be managed by a designated disability trustee rather than someone who is ordained by the court to watch over your assets. A disability trustee is someone who you choose to be the person to manage your trust and its assets if you become mentally disabled. You can also name more than one backup in case the first person you name is unable to take on the role of disability trustee. A disability trustee determines how the trust should be managed, as well as the living arrangements of the trust maker. When choosing a disability trustee, make sure that it is someone who is trustworthy, reliable, and has your best interests at heart in the future.
A Revocable Trust is just as efficient at avoiding probate as an Irrevocable Trust. Instead of being sent to court to be reviewed through probate, the assets of the grantor can go straight on to their beneficiaries. This also allows you to keep your information about where and whom your assets go to after your death private. Unfortunately, it is hard to completely eliminate probate, but creating a Revocable Trust can help minimize the amount of probate that your assets must go through after you pass. You will also still need a will for any of your assets or properties that are not listed within the trust to ensure that they are delegated the way that you wish them to be.
Next Steps:
So you have decided that you want to set up a Revocable Living Trust. The next thing that you should do is go to an estate planning attorney who has experience and background working with trust law. With your attorney you can create a trust that coincides with New Jersey state laws. If you do not work with an NJ estate planning attorney, you are taking the risk of drawing up a trust that does not work within state laws, and as a result may not be usable. An estate planning attorney can also help you decide if you should be using a Revocable Living Trust, a different kind of trust, or any kind of trust at all.
Some other names for a Revocable Trust:
Revocable Living Trust
Living Trust
Inter Vivos Trust
Why use a Revocable Trust?
Revocable Trusts are a good choice if you (the grantor) are preparing and planning to deal with your own mental illness or disabilities in the future. If your assets are in a Revocable Trust than, if needed, they can be managed by a designated disability trustee rather than someone who is ordained by the court to watch over your assets. A disability trustee is someone who you choose to be the person to manage your trust and its assets if you become mentally disabled. You can also name more than one backup in case the first person you name is unable to take on the role of disability trustee. A disability trustee determines how the trust should be managed, as well as the living arrangements of the trust maker. When choosing a disability trustee, make sure that it is someone who is trustworthy, reliable, and has your best interests at heart in the future.
A Revocable Trust is just as efficient at avoiding probate as an Irrevocable Trust. Instead of being sent to court to be reviewed through probate, the assets of the grantor can go straight on to their beneficiaries. This also allows you to keep your information about where and whom your assets go to after your death private. Unfortunately, it is hard to completely eliminate probate, but creating a Revocable Trust can help minimize the amount of probate that your assets must go through after you pass. You will also still need a will for any of your assets or properties that are not listed within the trust to ensure that they are delegated the way that you wish them to be.
Next Steps:
So you have decided that you want to set up a Revocable Living Trust. The next thing that you should do is go to an estate planning attorney who has experience and background working with trust law. With your attorney you can create a trust that coincides with New Jersey state laws. If you do not work with an NJ estate planning attorney, you are taking the risk of drawing up a trust that does not work within state laws, and as a result may not be usable. An estate planning attorney can also help you decide if you should be using a Revocable Living Trust, a different kind of trust, or any kind of trust at all.
Some other names for a Revocable Trust:
Revocable Living Trust
Living Trust
Inter Vivos Trust