A Living Trust is a legal document that enables you to leave instructions for who you want to handle your final affairs and how you want your assets distributed after you die. Living Trusts look a lot like a will but, unlike a will, a Living Trust does not go through probate (providing privacy concerning assets included in the living trust), it prevents the court from controlling your assets if you are declared incompetent, and it gives you (not the court) control over the assets in the trust that you leave to your minor children and/or grandchildren.
A Living Trust can be revocable or irrevocable (you can not change it or take out assets that have been placed in it). When you establish or set up the trust, you are called the Grantor (sometimes Settlor or Trustor). You will also name a Trustee to manage the assets you place in the trust. Many people name themselves, continuing to handle their affairs as they would have without the trust. Married couples often establish themselves as Co-Trustees. In case one of the Co-Trustees becomes incapacitated or dies, the other instantly has control, without court involvement, of the assets in the trust.
A Successor Trustee needs to be named in case you (or both of you in the case of Co-Trustees) becomes incapacitated or dies. This can be an individual (your adult children or dependable family friends) or a Corporate Trustee (a bank).
Each type, revocable or irrevocable, has advantages and disadvantages.