Suze Orman believes that everyone needs to have a revocable living trust and that anyone who has assets should have a will. A revocable living trust temporarily passes an individual's financial assets and responsibilities to a trustee if he is incapacitated. If the individual recovers, the assets are returned.
A revocable living trust allows individuals to pass assets to beneficiaries. For example, if an individual places his house into a revocable living trust and then dies, the house immediately passes to the beneficiary of the trust without entering probate. In some states, this may allow the recipient of the house to avoid certain taxes and fees.
A will also allows people to decide who receives their assets after death. However, in most states, the will must go through probate, a court procedure requiring court fees to be paid. During probate, the judge verifies the will and legally transfers assets to beneficiaries. The probate process may take six months to two years before the process is complete and the assets distributed.
Suze Orman does not recommend an irrevocable trust. Once assets are placed into an irrevocable trust, the terms of the trust cannot be changed without the permission of the beneficiary.