If you already have created a living trust but are thinking about changing some of its terms, there are some things you should know, and they may be found in the paragraphs below. Even if you have never heard of a living trust but are beginning to consider your estate planning options, the following paragraphs will provide you with some basic information about the living trust.
1. What is a living trust?
A living trust is, quite simply, an agreement between two parties for the benefit of a third. The first two parties are known as the “settlor” and the “trustee”; the settlor is the party who creates the trust, and the trustee is the party that holds legal title to the trust property for the benefit of the “beneficiary” (i.e. the third party). The reason it’s called a living trust is because the settlor creates it while still living.
2. Can you change the terms of a living trust?
Yes, it is possible to change the terms of a living trust. To do so, you will need to either complete a valid trust amendment, completed according to the laws in place in your jurisdiction, or you will need to complete a trust restatement. The basic idea is that you will not revoke the prior version of the trust, but just change it to fit your current needs.
3. Can the trustee change the terms?
No, the trustee cannot change the trust’s terms. Only the settlor of the trust is able to change the terms.