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What is a Revocable Trust?

A: A trust is a legal relationship created at the direction of an individual (the "grantor" or "trustor"), in which one or more persons hold the individual's property subject to certain duties to use and protect it for the benefit of others.  All trusts whether general or specific, consist of a trustor, trustee, trust property, trust indenture and one or more beneficiaries.  A trustor is the person that creates the trust and the trustee is the person that manages the trust.  Both general trusts and specific trusts are plans with the intended purpose of distributing money and/or property of significant value to others.  Personal trusts are very commonly used for estate and death planning.

There are many types of trusts, but all trusts fall into one of two categories, revocable trusts and irrevocable trusts.  Revocable trusts can be materially changed or even canceled altogether.  Irrevocable trusts can't be rescinded after they go into effect.  A revocable trust must be a living trust, i.e. set-up while you're alive.  However, many types of living trusts must be irrevocable, such as an insurance trust.  Simply put, a revocable trust is impermanent.  You generally can serve as trustee and beneficiary of a revocable trust you create. Therefore, you can retain control over any assets you transfer into the trust.

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