• A revocable living trust -- With a revocable living trust, ownership of assets is transferred to the trust while you are alive. You can keep any or all of the income, act as trustee, change the trust's provisions, or terminate the trust. You can provide for a successor trustee to take over if you become mentally or physically disabled. Assets in the trust are controlled by the trust agreement and are not subject to probate proceedings, which is considered one of its major advantages.

• A bypass or credit shelter trust -- This trust is generally used to ensure both spouses take advantage of their estate tax exclusion amount, without directly transferring assets to other heirs until both spouses have died. Generally, assets equal to the estate tax exclusion amount are placed in trust after your death, but you can place less than that in the trust. Keep in mind that there is no estate tax in 2010, but the estate tax exclusion amount will revert to $1,000,000 in 2011. Once the assets are placed in trust, your spouse can use the income and perhaps some of the principal, with the remaining assets transferred to your heirs after your spouse's death.

• A qualified terminable interest property (QTIP) trust -- If you have assets in excess of those going into the bypass trust, you can bequeath them directly to your spouse with no estate tax liability, due to the unlimited marital deduction. However, some spouses want to control how their spouse disposes of those remaining assets, placing assets in excess of those in the bypass trust in the QTIP trust. Income from the trust is distributed to the surviving spouse during his/her lifetime. This qualifies for the unlimited marital deduction, so estate taxes won't be paid after the first spouse's death. After the surviving spouse's death, the principal is distributed to heirs designated by the first spouse.