What is a Revocable Trust and Who Should Use One?

A revocable trust, also known as a living trust, is an estate planning tool that allows an individual (the grantor) to place assets into a trust while retaining the ability to modify, amend, or revoke it during their lifetime. This flexibility makes it a popular choice for many individuals looking to manage their assets efficiently while avoiding probate.

Key Features of a Revocable Trust

• Control and Flexibility – The grantor can make changes to the trust at any time, including adding or removing assets and modifying beneficiaries.
• Avoidance of Probate – Upon the grantor’s death, assets in the trust pass directly to beneficiaries without going through probate, saving time and legal expenses.
• Privacy Protection – Unlike a will, which becomes public record, a revocable trust remains private, protecting family financial matters from public scrutiny.
• Incapacity Planning – If the grantor becomes incapacitated, the successor trustee can manage the trust assets without the need for court intervention.

Who Should Use a Revocable Trust?

• Individuals with Significant Assets – Those with multiple properties, investments, or valuable personal assets benefit from the probate avoidance and streamlined management a trust provides.
• Parents of Minor Children – A revocable trust allows parents to establish guidelines for asset distribution to minors without court intervention.
• Business Owners – Business interests can be placed in a trust, ensuring continuity in case of incapacity or death.
• Those Seeking Privacy – If you prefer to keep your estate matters confidential, a revocable trust offers more discretion than a will.

While a revocable trust provides flexibility and ease of administration, it does not offer asset protection from creditors or reduce estate tax liability. Individuals concerned about these factors may want to consider an irrevocable trust (see my upcoming blog entitled What is an Irrevocable Trust and Who Should Use One).

If you have questions about revocable trusts, or any other estate planning considerations, please feel free to contact us at Forbes Law Firm.  Serving Davidson, Cornelius, Mooresville, Huntersville, and the greater Lake Norman and Charlotte areas, we’re here to provide expert guidance and support tailored to your family’s needs.