A living trust is a trust that a person creates while they are still alive. Unlike other trusts that are created at the time when the estate planner passes on, a living trust is one that is created by the estate planner and then is usually managed by that individual until the time that they pass away. Revocable living trusts are excellent estate planning tools for some Californians, because they allow individuals to maintain control over their assets, avoid probate and ensure that their end-of-life wishes are respected.
In order to create a living trust a person must create a trust and place their assets into it. A person may include their home in their living trust as well as their personal property, their liquid assets and bank accounts, retirement investments and a host of other forms of property. They may name themselves as the beneficiary of the trust as therefore live off of the trust while they are still alive. A living trust may continue to take care of a person in the event that they become incapacitated.
If a person who has created a living trust becomes incapacitated then their secondary trustee will take over the responsibilities of managing the trust. If the trust creator recovers they may return to their role as trustee. If they pass on then the secondary trustee may oversee the execution of the trust after the creator’s death.
Making a living trust revocable allows a trust creator to make changes to cancel the trust prior to their death. Ultimately a revocable living trust is a flexible estate planning tool that protects a person’s wealth and can be changed to meet their testamentary expectations and desires.