There are several types of Trusts, but the most common are: Revocable Living Trusts and Irrevocable Trusts
A Trust is a document that explains the rules that you want followed for property held in trust for your beneficiaries. You are generally the Grantor, who creates the trust and gives control of your assets to the Trustee, who in turn has a fiduciary duty to carry out the instructions of the Trust for your Beneficiaries. There are several benefits to having a trust, but one of the best is that your assets don’t go through the process of probate.
What is a Living Trust?
The most common type of trust is the Revocable Living Trust (“RLT”). The RLT allows you to maintain control of all the assets in the trust, because often times you are the Grantor, Trustee and the Beneficiary. You have the ability to revoke or change the terms of the trust at any time.
Contrary to a RLT, the Grantor of an Irrevocable Trust appoints someone as the Trustee to control the assets in the Trust. You typically can’t make changes to the trust without the beneficiary’s consent. Irrevocable Trusts are often used to protect assets from creditors. They can also be used to provide support for minors and adult children who are financially irresponsible.