Do I Need an Irrevocable or a Revocable Trust?

If you’re confused as to whether you need an irrevocable trust or a revocable one, then you’re not alone. Because so many laymen struggle to understand the seemingly subtle–but not really–differences between the two, it’s important you hire proper legal representation in order to establish the need for one versus the other. The circumstances under which you choose one can differ from that of another, so this is an extremely important step to undertake.

An irrevocable trust can’t be changed once put into place, while a revocable trust can be modified for certain reasons.

Your decision for irrevocable vs revocable trusts is important. Let’s say, for example, you were married, then divorced, and then remarried. You had children during both marriages, but there was a significant time gap in between. The children from your first marriage are grown. They’ve gone through college, and they’re on their own–maybe they even have kids of their own. The children from your second marriage are younger, and you haven’t needed to invest the same financial resources into them as you did the children from your first marriage.

You might decide upon a revocable trust. You might enable assets to flow freely for the children who still require them. After college, the trust might then call for an equal distribution of the remaining assets. If something happens in the meantime, the trust can still be altered to reflect the new circumstances.

Irrevocable trusts are often maintained as a way to jump through tax loopholes. They can save you and inheritors time and money down the road. This is because the value of your estate doesn’t often include the value of an irrevocable trust. Estates are only taxed when they exceed $5.49 million, but if an irrevocable trust puts you over that threshold you still don’t need to worry about it.

Estate planning lawyers who work with clients of modest means often advise them to lower retirement expectations and consider the future more conservatively, especially when kids in their 20s are still in the picture. These days, children often suction off a lot more money as time goes on, even after parents expect they shouldn’t. While it’s up to the parents to decide, and circumstances are certainly unique to any couple, it’s always good to think about the future as if anything could happen–because it often does.

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Melissa Thompson

Melissa is a mother of 2, lives in Utah, and writes for a multitude of sites. She is currently the EIC of and writes about health, wellness, and business topics.