Perhaps the first thing that people need to understand about creating a living trust, also known as an inter vivos trust, is why a person would want one in the first place. The advantage of creating a living trust is that it will preserve the ownership and disposition of your property should you become incapacitated while you’re still alive. That is because you will be established as the trustee of your living will.
In your capacity as the trustee of your own living will, you reserve the right to make changes or even revoke the trust at any point. For example, you may want to manage a portfolio of stocks or bonds. A revocable living trust allows you to do that without destroying the integrity of the trust. The same goes for other valuable assets and property you own. You can still deposit and withdraw money from your bank accounts, continue using your car or even sell it off if you so desire. The revocable living trust is completely malleable in nature.
Another benefit of the revocable trust is that you can set it up so that it disposes of your property in an orderly fashion after you die. That could help your family and loved ones avoid expensive and lengthy probate.
Alternatively, you may wish to establish an irrevocable trust. As the name implies, this is a trust in which you have established someone other than yourself as the trustee. The person you designate as the trustee will become the manager of the trust. It is important to know that you will be unable to revoke trust once you have delegated the authority to your assigned trustee. The only exception to that is if you have included your reservation to amend that trust in the language of that document.
Every person has unique characteristics regarding their needs for asset protection, potential beneficiaries or perhaps even tax-related issues. New York residents may find the guidance of an attorney experienced in estate law helpful in determining the best course of action regarding trusts.
Source: Findlaw, “N.Y. EPT. LAW § 7-1.9 : NY Code – Section 7-1.9: Revocation of trusts” Aug. 12, 2014