You've created your living Trust – now what? Establishing your Trust is only the first step in ensuring that your property will go to your desired beneficiaries outside of Probate court. The next step is the most critical one - “funding” your trust - whereby you change title to your property into the name of the Trust that you created.
Here is a helpful checklist to follow so as to ensure that you have fully funded your living Trust, and will continue to fund your trust as you acquire future assets:
- Ensure that title to all your real estate (nationwide) was recorded in the name of your trust.
- If you have refinanced real estate that was already titled in the trust – ensure title remained in your Trust after the refinance. If you are unsure – contact your estate planning attorney to confirm.
- For all of your real estate – call your Home Owner's Insurance company, and have them add the name of your Trust as an “additional insured” [this is very important, to avoid a refusal to pay on a claim].
- For your bank accounts: visit your Banks, bring your trust, meet with a banker, and retitle your bank accounts in the name of the Trust.
- Connect with your financial advisor and ensure that your investment accounts are titled in the Trust.
- Don't forget to discuss with your financial advisor the new IRA rules under the revised SECURE Act (i.e., the elimination of the stretch IRA, etc.) and how that would affect your beneficiaries in the context of distributions under your Trust.
- Connect with your life insurance broker and ensure the Trust is listed as the pay-on-death beneficiary of your life insurance policies.
- If you get life insurance benefits through work – see your HR Department, and find out how you can name your Trust as the beneficiary of that employer-sponsored insurance policy.
- If you own a Timeshare – contact the Timeshare Administrator and start the paperwork to retitle the timeshare into your trust.
- If you own a vehicle exceeding $166,250 in value – visit the DMV and change title to your Trust (be sure to bring the trust document along).
- If you have registered a Corporation or an LLC (whether in California or in another jurisdiction) – have your estate planning attorney prepare an Assignment of your business interest to the Trust.
This is not an exclusive list; the “to-do” funding list specific to you will depend on your specific assets.
Keeping your Trust funded is a life-long process, and the only prudent approach to ensure that the Trust terms will indeed reach all of your assets. Assets inadvertently left outside the Trust generally can be titled back into the Trust via your Pour Over Will. However, this requires filing a Petition with the Court, a formal noticed hearing, a Judicial approval, and may be quite costly and time-consuming.
To avoid such additional court process, expense and delay with the administration of your assets – there is simply no substitute to fully funding your trust during your life – which remains your responsibility as Trustee.
Be sure to periodically check in with your estate planning attorney whose rule is to continuously guide and assist you with any questions you might have in this regard. Connecting your estate planning attorney to your financial advisors, life insurance agents, realtors, etc. is a smart way to facilitate the collaboration between all members of your wealth management team, to ensure your trust is funded at all times.
The Law Offices of Maria N. Jonsson, PC is a Trust & Probate Law Firm servicing the Venice/Marina del Ray area, and the LA Westside. We assist with estate planning as well as post-death administration of trusts and probate estates.
Click here to schedule a complimentary consultation with the attorney and discuss your estate planning needs. We are located at 475 Washington Blvd., Marina del Rey, CA 90292, and can be reached by phone at (424) 383-8445. We look forward to assisting you!