Trust funds are not just for the ultra rich. These sophisticated estate-planning tools can make just as much sense for middle-class Americans who own a home and have a net worth of at least $100,000. Although they can be set up differently, all trusts fall into one of two broad categories — revocable or irrevocable.
"A revocable trust is like the minivan of estate planning," says Steve Parrish, co-director of the Center for Retirement Income at the American College of Financial Services. "They are multipurpose and used more by the upper-middle class. An irrevocable trust is like a high-performance sports car. They can be more expensive but also more customizable to a specific need."
