What happens to a revocable living trust when the grantor dies?

When the grantor of a revocable living trust passes away, the trust typically transitions from being revocable to irrevocable. This means that the changes that the grantor could make while they were alive—such as altering the trust's terms or withdrawing assets—are no longer possible. The trust now operates according to the terms that were established by the grantor during their lifetime.

This shift to irrevocability is significant because it serves to protect the trust assets and ensure that they are distributed according to the grantor's intended wishes outlined in the trust document. The assets within the trust are usually managed by a successor trustee, who was designated by the grantor, and will adhere to these terms for the benefit of the beneficiaries specified in the trust.

Understanding this transition is crucial for beneficiaries and estate planners, as it affects how assets are handled after the grantor's death and how the estate is settled. This long-term stability offered by the irrevocable trust helps in maintaining management and protection of the assets without undue interference from external parties.