What is a revocable living trust?
Here’s another way of thinking about: Imagine you set up a box and you put everything you own—bank accounts, real estate, investments, etc. into that box. Attached to the box is a very detailed set of instructions written it by you. It specifies who will manage the assets within the box (typically you, but you’ve also named successors in the event of your disability or death) and who can benefit from the assets in the box—i.e., who can we spend on? So, for example, if you are married with young children, your trust might specify that while you are living, the trust assets can be used to take care of you, your spouse and your children. The trust would also specify how you want your assets managed and distributed upon your death.
The term “revocable” indicates that as the trustmaker you retained the rights to amend the terms of the trust or revoke it entirely. You also have the right to add or remove property from the trust at any time.