What is a living trust?

A living trust is indeed characterized as a trust established by a living trustor, who creates it during their lifetime to manage the legal title of their property. This type of trust allows the trustor to retain control over the assets placed in the trust, enabling them to manage, utilize, or alter the trust as long as they are alive. The main advantage of a living trust is that it can help avoid probate, allowing for a more streamlined transfer of assets to beneficiaries after the trustor's death.

In contrast, the other options do not accurately represent what a living trust is. A trust established after death refers to a testamentary trust, which is created through a will and only comes into existence upon the death of the testator. A temporary agreement for managing debts does not align with the definition of any trust, as trusts are typically long-term arrangements for asset management. Lastly, a simple will for distributing personal property is fundamentally different from a living trust, as a will is a legal document that outlines how personal belongings should be distributed upon death, rather than the ongoing management of assets during life.