The basic difference between a testamentary vs. a living trust is when the trust is set up. A testamentary trust is established created when or as a result of the grantor’s death whereas a living trust is established while the grantor is still alive.
A testamentary trust is part of a person’s will. As a result it cannot come into existence until the will is probated. Testamentary trusts are seldom used since avoiding probate is an essential component of a properly structured plan.
Both a living trust and a testamentary trust are revocable during the grantor’s lifetime. Both types of trusts become irrevocable once the grantor dies.
Note: Technically, for married individuals who create a living trust that includes A/B Provisions, they have a testamentary trust inside their living trust, as the B Portion of the A/B trust is not established until the death of the first spouse. In this case, the testamentary trust is not created by a will so no probate is required.