It’s recommended that we begin with our estate planning efforts as soon as possible. After all, we don’t know what life could bring — it’s always best to be prepared. Estate planning documents like wills and revocable trusts can be created at any point of a person’s life. But they should also be updated regularly to reflect new goals and changes in circumstances.
Sometimes, a person could have a revocable trust and realize that they want to revoke it later. This can happen if they no longer want their assets to be part of the family entity. It’s possible to revoke a revocable trust through a revocation of revocable trust document.
How to Revoke a Revocable Trust
In order to revoke a revocable trust, one has to create a revocation of revocable trust. This is a document that declares the revocation and lists the specific name, date, and amendments to the trust. By filing a revocation document, the revocable trust will no longer exist.
It sounds simple when put that way. But what if a revocable trust has assets in it? These assets need to be taken out of the family entity. So when a revocation document is filed, the person revoking should take care to remove all the assets from the trust.
In cases of real estate properties that are in the trust, they have to create a real estate deed to rename the owner and get the property out of the trust. It’s the same case with bank accounts and life insurance policies. These documents need to be updated to make sure that the trust is no longer listed as the pay on death beneficiary.
If these documents are not updated and the assets are not taken out of the trust, it can cause problems in the long run. Looking at it this way makes revoking a revocable trust a much harder process. And this is why it’s not common for people to revoke their trust.
What If You Don’t Revoke a Trust?
People typically don’t revoke a trust so that they don’t have to worry about the assets in it. And this is a more practical solution. What can be done instead is changing the trust beneficiaries on the beneficiary designation forms to make sure that the assets go to the intended people.
