There are several types of living trusts. Each tailored for a specific estate planning purpose.
A Revocable Trust will allow the creator to maintain complete control of his or her assets, this includes the power to amend and revoke the trust at any time. The major advantage of a revocable trust is that the assets in the trust avoid the expensive and time consuming probate process.
An Irrevocable Trust will also allow the creator to avoid the probate process, however it will not allow the creator to maintain control of the trust assets like a Revocable Trust. The purpose behind an Irrevocable Trust to protect your assets against the high cost of nursing home care. Should the creator enter a nursing home, the assets in the trust would not be included in determining eligibility for Medicaid as long as certain requirements are met.
A Supplemental Needs Trust is a living trust specifically for people with disabled children. If a disabled individual is receiving Medicaid or Supplemental Security Income (SSI) benefits, an inheritance from their family could jeopardize their ability to qualify for those benefits. An individual may transfer assets to this trust for the benefit of their disabled children and at the same time, allow those children to receive the benefits of your assets without losing their Medicaid or Supplemental Security Income (SSI) benefits.