A revocable trust is a type of inter-vivos, or living, trust. An irrevocable trust is the other living trust option. If you are considering the use of a revocable trust as part of your estate plan, you should have a basic understanding of the benefits, and limitations, of a revocable trust. One way that a revocable living trust can be useful as part of an estate plan is as an incapacity planning tool.
When you create a revocable trust, you must name a trustee, at least one beneficiary and designate assets to fund the trust. You may name yourself as trustee and beneficiary if you choose to do so. You can also name one or more successor trustees. You may then transfer assets into the trust and proceed to administer the trust according to the terms you, yourself created. When you create the trust, you can determine what triggering events, such as your incapacity or death, will cause the successor trustee to take over for you.
In the event that you do actually become incapacitated at some point, the administration of the trust will pass immediately to your successor trustee. The trust will already have assets that are being used to fund the trust. In this manner, your spouse, child, parent or other loved one will have immediate access to assets that may be needed to care for you or your estate in the event of your incapacity without having to go through a court.
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