Built to Outlast You

Revocable and irrevocable living trusts compared: how to choose between them, how to set one up, and how to run it, with notes for Texas families

Sooner or later, almost everyone who sits down to plan an estate hears the same question: 

"Have you thought about a trust?" It sounds like one decision. It is really two. The first is whether a trust makes sense at all. The second, and the one people understand least, is which kind: a revocable trust that you can change any time, or an irrevocable trust that you generally cannot. 

The two share a name and some paperwork, but they do very different jobs. A revocable trust is mainly an administrative tool. It keeps your estate out of probate, keeps your affairs private, and gives someone you trust a clear way to step in if you become unable to manage your own finances. An irrevocable trust is a strategic tool. By giving up ownership and control, you can move assets out of your taxable estate, out of reach of some creditors, and out of the Medicaid spend-down calculation, and you can put lasting guardrails around what your heirs receive. 

This article compares the two side by side, offers criteria for choosing, explains how each is established and managed, and closes with the steps to take if you decide to move forward.