Funding Your Revocable Living Trust
Establishing your future through effective estate planning is a smart move that can save you time and money. Utilizing a living trust limits the risks of your assets being tied up in court by probate, can save estate taxes, and protect inheritances for your loved ones. There are a lot of benefits by putting a revocable living trust in place, but what about funding your trust? This is one aspect of revocable living trusts easily forgotten, leading your trust into the court process instead of assets being distributed as you wish. Phelps Law are your legal experts on all your estate planning needs, including the living trusts and are here to ensure the process goes well and that includes funding your trust.
What Does Funding Your Trust Mean?
When you have gone through the paperwork to set up the trust and those who will inherit from you, it is just the first step. From there you need to “fund” your trust. This simply means that you have to transfer your assets from you to your trust. You will have to physically change the title of your assets from your name to the name of your trust.
Importance of Funding Your Trust
It is imperative that you actually fund your trust. Unless you have transferred your assets into your trust name, just signing the document for your living trust and the plan you created will not help you avoid the timely, and costly, process of probate. Your living trust can only control the assets you put into it, therefore if you don’t put any assets into it, then nothing is under the living trust. The goal of a living trust is to avoid the court intervening by taking over your assets if you become incapacitated and probate at death. To avoid these, then you must fund your trust now.
What Assets To Put In Your Trust
It can be a difficult process to decide which assets to put in your trust, but you essentially want most of your assets in your trust. As you name yourself as the trustee, you will still have full control over your assets while you are alive and well, so that should not be a concern. Some assets to ensure are included should be:
- Bank/credit union accounts and safe deposit boxes
- Real estate property (home, land, other real estate)
- Life insurance
- Investments (mutual funds, stocks, CDs)
- Notes payable (money owed to you)
- Personal untitled property
- Business interests
- Oil and gas interests
There are a vast array of assets that would benefit from being in your revocable living trust. Contact Phelps Law to discover the specifics of what would be best for you and your loved ones.
Images used under creative commons license – commercial use (7/10/2017) U.S. Army Europe (Flickr)