Your revocable living trust should carry out your wishes based on your current situation in life, but it should also be flexible enough to account for potential unexpected events. Here are some of the things that one might consider:

1. Death of a child or other family member
2. Incapacity of a child or other family member
3. Birth of additional children or other family members
4. Possibility that a beneficiary may be suffering from substance abuse
5. Possibility that a beneficiary may have creditors
6. Possibility that a beneficiary might be a victim of fraud or undue influence
7. Possibility that a beneficiary may be relying upon special government assistance

By taking precautions to think through these possibilities, one may be able to avoid the need to amend his or her estate planning documents by incorporating provisions to deal with these contingencies. 

One of the major objectives of using a revocable living trust is to plan for incapacity. For that reason, revocable living trusts typically contain a provision that provides for a successor Trustee who is able to manage the assets of a trust for the benefit of the Trustor (the creator of the trust) while the Trustor is incapacitated.

The standard for when the successor Trustee will assume the role of Trustee usually depends on the medical determination of one or more physicians. Some trusts may also allow the successor Trustee to make this determination based on his or her personal judgments. As a practical matter, however, financial institutions that hold the trust assets may have a difficult time accepting an informal determination by a successor Trustee.

If relying on the certification of one or more physicians, it is important to ensure that an Advance Health Care Directive naming an agent is in place. A physician may decline to render an opinion regarding the current Trustee's capacity without a document allowing disclosure of sensitive medical information.

As our population's lifespan increases, the risk that a portion of it may be spent in an incapacitated state makes it even more important to ensure that proper measures are in place to plan for these situations.

In California, a trust is revocable unless the document provides otherwise. California Probate Code Section 15400 states:

Unless a trust is expressly made irrevocable by the trust instrument, the trust is revocable by the settlor. This section applies only where the settlor is domiciled in this state when the trust is created, where the trust instrument is executed in this state, or where the trust instrument provides that the law of this state governs the trust.

The ability to revoke a trust also includes a Trustor's right to modify the terms of the trust as well. This is specifically provided for under California Probate Code Section 15402, which provides:

Unless the trust instrument provides otherwise, if a trust is revocable by the settlor, the settlor may modify the trust by the procedure for revocation.

*Settlor is synonymous with the term "Trustor" or "Grantor". It simply means the person who created the trust.

Because there can occasionally be confusion after the Trustor's death as to whether additional writings are valid amendments to the revocable trust, the terms of the trust should include specific provisions regarding how an amendment should be made.

Describing the specific procedures can also help to show the Trustor's intent to make a valid and enforceable amendment. Some common requirements include:

• The need for the Trustor to create a writing which specifies the modifications he or she is making to the trust.
• That the amendment be delivered to the Trustee.

The latter requirement is often informal since a Trustor is typically also the Trustee while he or she is competent and alive. 

Amendments v. Restatements

Amendments to revocable living trusts are sometimes created in the form of a "restatement". An amendment to a trust normally refers to a document which purports to modify a few provisions of an existing document. As a result, to understand the complete terms of the trust, one would need to have the original terms of the trust as well as the amendments to it to understand how the trust works.

A restatement, on the other hand, is an amendment to a trust which re-writes the entire document. With a restatement, there's no need to reference look at prior documents since the restatement itself contains all of the terms of the trust. A restatement is often preferred when one wants to make numerous changes to an existing trust document.

If you have a revocable living trust, you may find yourself needing to have an amendment prepared if you or your family experience major life changes. Luckily with modern word processing tools, this process is painless. Discussing your ideas with an estate planning lawyer will often allow you to accomplish your goals in the most efficient manner possible.

Unlike other states in the US, the probate process in California (which is required if one dies with only a Will or without any estate planning documents at all), is (a) time consuming and (b) expensive. As a result most people in California should consider utilizing a revocable living trust as the primary estate planning vehicle as it minimizes the risk of encountering the probate process.

Probate proceedings in California require notices and hearings, which take time to complete. In addition, a number of ancillary issues might arise during the public probate process that requires attention, such as dealing with creditor claims. If that weren't enough, the fees incurred during the probate process are usually much higher than the fees associated with administering a revocable living trust with comparable assets. California Probate Code Section 10800 describes how the fee for the Executor of an estate is calculated:

a) Subject to the provisions of this part, for ordinary services the personal representative shall receive compensation based on the value of the estate accounted for by the personal representative, as follows:

(1) Four percent on the first one hundred thousand dollars ($100,000).

(2) Three percent on the next one hundred thousand dollars ($100,000).

(3) Two percent on the next eight hundred thousand dollars ($800,000).

(4) One percent on the next nine million dollars ($9,000,000).

(5) One-half of one percent on the next fifteen million dollars ($15,000,000).

(6) For all amounts above twenty-five million dollars ($25,000,000), a reasonable amount to be determined by the court.

(b) For the purposes of this section, the value of the estate accounted for by the personal representative is the total amount of the appraisal value of property in the inventory, plus gains over the appraisal value on sales, plus receipts, less losses from the appraisal value on sales, without reference to encumbrances or other obligations on estate property.

The lawyer handling the probate for an Executor or Administrator is also entitled to the same statutory amount.

The other major benefit is that a revocable living trust helps you avoid a conservatorship if you become incapacitated. This is because your trust can allow for a successor Trustee to step in and take control of trust assets to manage and use them for your benefit. This avoids the need to have a court proceeding to appoint a conservator to manage your affairs (which, by the way, is expensive and can be highly inconvenient for your family).

Although a revocable living trust has great advantages, there are a few disadvantages. Despite, the disadvantages, however, the benefits often far outweigh the downsides.