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What Is a Revocable Living Trust?

A revocable living trust is a popular estate planning tool that allows you to manage your assets during your lifetime and ensure a smoother transfer to beneficiaries after your death—without the need for probate. Especially in Texas, where avoiding probate can save time and money, revocable living trusts offer flexibility and control that wills alone cannot provide.

At The Lange Firm in Sugar Land, Texas, we help individuals and families create estate plans that reflect their values, goals, and unique financial circumstances. If you’re wondering whether a revocable living trust is right for you, this guide covers everything you need to know.

What Is a Revocable Living Trust?

A revocable living trust (also called a living trust or inter vivos trust) is a legal document that places your assets—like real estate, bank accounts, or investments—into a trust during your lifetime. You retain control over these assets as the trustee and can revoke, change, or dissolve the trust at any time.

After your death (or if you become incapacitated), a successor trustee steps in to manage or distribute the trust property according to your instructions—without court involvement.

Key Features of a Revocable Living Trust

1. Revocable

You can modify or cancel the trust at any point during your lifetime, so long as you are mentally competent. This flexibility makes it a preferred option for many people.

2. Living

The trust becomes effective while you are alive, unlike a will, which only takes effect upon death.

3. Trustee and Successor Trustee

• You usually serve as the initial trustee, managing all assets in the trust.

• A successor trustee takes over when you’re no longer able or willing to serve.

What Can You Place in a Revocable Living Trust?

Almost any type of asset can be placed in a revocable living trust, including:

• Real estate (your home, rental property, or vacation house)

• Bank accounts (checking, savings, CDs)

• Stocks and bonds

• Business interests

• Personal property (art, jewelry, vehicles)

• Life insurance proceeds (by naming the trust as a beneficiary)

However, retirement accounts like IRAs and 401(k)s are not typically retitled into a trust, although the trust can be named as a beneficiary.

Benefits of a Revocable Living Trust

1. Avoiding Probate

One of the most significant advantages is bypassing the probate process, which can be time-consuming and costly. This means faster access to assets for your loved ones.

2. Privacy

Unlike wills, which become public record during probate, a revocable living trust remains private—even after your death.

3. Incapacity Planning

If you become incapacitated, your successor trustee can step in without court approval. This avoids the need for a guardianship or conservatorship proceeding.

4. Efficient Asset Management

Your trustee can manage your assets during your lifetime, in case you choose not to or are unable to.

5. Control and Flexibility

You set the terms: when and how your assets are distributed, who manages them, and under what circumstances.

Downsides of a Revocable Living Trust

While revocable living trusts offer many advantages, they also come with some drawbacks:

1. No Tax Advantages

Revocable trusts do not offer protection from estate taxes or income taxes during your lifetime.

2. No Asset Protection

Because you retain control of the assets, they are still subject to creditors and lawsuits.

3. Upfront Cost and Maintenance

Creating a revocable living trust typically costs more than a simple will. Additionally, assets must be retitled into the trust—if this is not done properly, the trust may not avoid probate.

4. Not a Complete Estate Plan

A trust doesn’t name guardians for minor children or handle all estate needs. A comprehensive estate plan should include a pour-over will, powers of attorney, and advance healthcare directives.

What Happens After Death?

When the person who created the trust (called the grantor or settlor) passes away:

• The successor trustee gathers the trust assets.

• Debts and expenses are paid.

• The remaining assets are distributed according to the trust terms.

Importantly, this process is handled outside of court and usually much faster than probate.

Revocable Living Trusts in Texas: What You Should Know

Texas has a relatively efficient probate process compared to other states, but a revocable living trust can still offer substantial benefits, particularly for:

• Blended families

• Individuals with out-of-state property

• Those who want to keep their estate private

• Families concerned about future incapacity or conflict

At The Lange Firm, we’ve worked with countless Texas families to create trusts tailored to their needs—helping them protect their legacy and provide peace of mind.

How to Create a Revocable Living Trust

Creating a revocable living trust typically involves the following steps:

1. Work with an Estate Planning Attorney
   Work with a firm like The Lange Firm to draft a customized trust agreement that reflects your goals and complies with Texas law.

2. Transfer Assets into the Trust
   You must fund the trust by retitling assets into its name. This is an essential step—otherwise, the trust is just an empty shell.

3. Update Beneficiaries
   Update life insurance policies and retirement accounts if you intend to name the trust as a beneficiary.

4. Create a Pour-Over Will
   This will “catch” any assets not placed in the trust and ensure they are transferred into it at your death.

5. Review and Update Regularly
   Your trust should be reviewed whenever you experience a major life change (marriage, divorce, birth, death) or a shift in financial status.

Should You Use a Revocable Living Trust?

A revocable living trust isn’t for everyone. Whether it’s right for you depends on your assets, family dynamics, and estate planning goals.

A trust may be especially helpful if:

• You own property in multiple states.

• You want to keep your estate matters private.

• You want a quicker, more efficient distribution of assets.

• You want to plan for incapacity without involving the court.

Common Myths About Revocable Living Trusts

Myth 1: Only the wealthy need a trust.

Reality: Trusts can benefit middle-income families, especially those with complex family dynamics or real estate in multiple states.

Myth 2: A will is enough.

Reality: Wills must go through probate. A trust can save time, costs, and maintain privacy.

Myth 3: A trust eliminates all taxes.

Reality: Revocable living trusts do not provide income tax or estate tax protection. Other tools are needed for that.

Work with The Lange Firm to Create Your Texas Trust

Setting up a revocable living trust requires care, strategy, and legal precision. At The Lange Firm in Sugar Land, Texas, we specialize in estate planning strategies that protect your assets and ensure your wishes are honored. We’ll help you understand whether a revocable living trust makes sense for your situation and guide you through every step—from drafting to funding the trust.

Final Thoughts

A revocable living trust is a powerful tool for managing and distributing your estate, avoiding probate, and planning for incapacity. When created properly, it offers peace of mind and financial clarity to both you and your loved ones.

If you’re ready to take the next step in your estate planning journey, contact The Lange Firm to get started.