As with wealth planning in general, many people think trusts are appropriate only for the very affluent. But personal trusts are a powerful planning tool that can deliver benefits for a wide range of people across the wealth spectrum.

Benefits of trusts

There are two main types of trusts:

• Revocable trusts allow you to retain as much control as you like over the trust and the assets you place in it. You can serve as trustee of your own revocable trust, change the trust’s terms whenever you like, add or withdraw assets at any time, and name a successor trustee to take over should you no longer wish or be able to serve as trustee.
  
  Your ability to transfer almost any type of asset to the trust, including financial assets, real estate and even private business interests, makes them helpful in consolidating and managing assets.
  
  You can also use a revocable trust to document how you want the assets in the trust to be managed, distributed and used after you are gone. Often, people believe a will is sufficient to handle all their needs. However, it’s important to note that a will only works when you die. A revocable trust provides benefits during your life as well, such as continuity in the event you become incapacitated. Assets in revocable trusts also avoid probate, enabling you to avoid the public disclosure, time and fees associated with it.
  
  
• Irrevocable trusts allow you to permanently remove assets from your taxable estate and can only be changed under very specific circumstances.
  
  Irrevocable trusts can be used to provide for a spouse and children from a prior relationship, help ensure that your heirs manage and use funds wisely and minimize federal and state wealth transfer taxes.