iving trust. Loving trust. Revocable trust. Whatever you call it, it's received far too much hype for its value.

Is this trust the solution for everyone's estate problems, as some might suggest?

Not really. Revocable trusts certainly have lots of advantages, but they're unnecessary for a great many people. Your personal financial situation, the type of assets you own and the location of those assets are just as important as your net worth in deciding whether a living trust makes sense for you.

At its most basic, a living trust is a trust you set up during your lifetime. But in popular estate-planning jargon, the term "living trust" specifically refers to a revocable living trust. This is one that you set up during your lifetime and that allows you to terminate it, change trustees, change beneficiaries, and move assets in and out of it whenever you want. An irrevocable trust doesn't give you such freedom.

In figuring out whether a revocable trust makes sense for you, you need to look at what the trust does - both while you're alive and after you've died.

While you're alive, a living trust allows you to transfer control of your assets to a trustee or successor if you become disabled or incapable of managing your affairs. But you can do that with a durable power of attorney; you don't have to create a trust to do it.

With a trust, you literally have to identify all of your assets and declare them a part of the trust. This painstaking process is called "retitling." The advantage a living trust offers over a durable power of attorney is that if something happens to you, all of your assets are neatly placed in a single legally binding basket: the trust.

A living trust also allows you to name successor trustees. With a durable power of attorney, you can usually name only one person to take over if you become incompetent. A living trust gives you more flexibility. You can name someone else to handle your estate if the first person you named can't do it.

A word of caution: Many people set up revocable trusts but never get around to transferring assets into them - the trust is merely an empty shell. Changing the name on an asset is easy. Leaving it unchanged if you don't have a durable power of attorney is a huge financial mistake.

The real advantages of a revocable trust kick in when you die.

First, all property in the trust avoids the probate process. This means that if you have a large estate, you can save substantially in attorney and executor fees. Find out the laws for your state, as most states have laws setting standard attorney and executor fees as a percentage of the probate estate.

By avoiding probate, you may save upwards of 2 percent of your assets, or you may be able to use a family member or close friend who will charge very little or nothing. On the other hand, if you set up a living trust to avoid probate costs, you should check out the going rates for area law firms and professional executors. Consider possible expenses carefully: The cost of setting up the trust may be more than the probate costs that you would avoid.

If you own property in states other than the one in which you legally reside, putting that real estate in the living trust will prevent your heirs from having to go through probate in every state in which you own property. That in itself is a hassle that can make a living trust well worth the effort.

Another major advantage of a living trust is that most of us prefer to keep our personal finances private. Wills and probates are public record and anyone who wants to pay a nominal fee can go to your courthouse and get copies. Trusts and their assets are not public. This is especially useful if, among other estate-planning situations:

Keep in mind that some insurance agents and investment managers "prospect" for new clients by getting public information about large estate settlements through probate court records. If you're concerned about the ability of your beneficiaries to manage money, or you're concerned about their gullibility, the privacy of a revocable trust could be helpful. You can have terms in the trust that will protect them as well.

The major disadvantage of the living trust is that it does not escape estate taxes upon your death. That it does escape taxes is the single biggest misstatement made by unscrupulous legal advisers, investment managers and insurance agents.

They're trying to get you to set up a living trust so that they can receive legal fees, ongoing investment fees and insurance commissions. Keep in mind that if your estate is large enough to incur estate taxes, the way to do so it is with traditional estate-planning documents such as a will and a credit shelter trust, as well as by traditional gifting techniques.

If you're going to use a revocable trust and plan to put all of your assets into it, you still need a will. The will should name an executor and guardians and should state that all of your probate assets will "pour over" into your revocable trust.

Some estate planners say you don't need a will if you have a living trust. But there will inevitably be assets that you did not put into your trust or assets you did not realize you owned. Those assets would then be subject to the intestacy laws of your state.

Whatever you do, don't use a printed "revocable trust form" and fill in the blanks. See a competent estate-planning attorney to determine whether such a trust makes sense for you, and then spend the extra few hundred dollars necessary to make sure you have an airtight estate plan with coordinated wills and trusts.

Living trusts have been touted as an easy way to accomplish many estate-planning objectives. Living trusts certainly do have their advantages, but they may be overkill if you have a simple estate-planning situation and don't have privacy or unusual estate distribution concerns.

Spending the money on good legal advice can give you piece of mind. It also can save you a huge amount of time retitling your assets if it turns out that a living trust is not worth your while.