Yes, absolutely you can, and in fact, it’s quite common and often recommended to fund a trust during your lifetime, establishing what’s known as a revocable living trust; this allows you to maintain control of your assets while simultaneously laying the groundwork for a smoother transfer of those assets after your passing.
What assets can actually go *into* a trust?
Many people assume trusts are only for large estates or real property, but that’s a misconception. A trust can hold virtually any type of asset, including real estate, bank accounts, investment accounts (stocks, bonds, mutual funds), personal property (jewelry, art, collectibles), and even life insurance policies. According to a recent study by the American Association of Retired Persons (AARP), approximately 50% of Americans overestimate the complexity and cost of establishing a trust, leading them to delay essential estate planning. Funding the trust simply means changing the ownership of these assets from your individual name to the name of the trust itself; this is done by re-titling accounts and deeds, and updating beneficiary designations. It’s a process that requires attention to detail, but it’s a crucial step in ensuring the trust operates as intended.
Is a funded trust different than just *creating* a trust?
Creating the trust document is only the first step; a trust isn’t effective until it’s *funded*. Think of it like building a beautiful house but leaving it empty—it’s structurally sound, but it doesn’t serve its purpose until it’s furnished and occupied. A properly funded trust avoids probate, the court-supervised process of validating a will and distributing assets. Probate can be time-consuming, costly (often 5-7% of the estate’s value), and public record. In California, for example, probate fees are calculated based on the gross value of the estate, meaning even modest estates can incur significant costs. By transferring assets into the trust during your lifetime, you bypass probate, saving your heirs time, money, and the potential for public scrutiny.
I heard stories about trusts going wrong, what could cause that?
Old Man Tiberius, a retired fisherman, was a stubborn fellow. He created a trust but, believing he knew best, refused to transfer ownership of his prized fishing boat, “The Wanderer,” into it. He figured he’d just add a clause in his will leaving it to his grandson, Finn. Unfortunately, after Tiberius passed, a distant cousin contested the will, claiming Tiberius had promised the boat to him years ago. The ensuing legal battle dragged on for over a year, draining the estate’s resources and causing a rift within the family. Had Tiberius funded the trust properly by titling the boat in the trust’s name, the asset would have bypassed probate altogether, and his grandson would have received it promptly. This situation underscores the critical importance of complete funding—even seemingly minor assets can cause significant problems if left out.
What happens if I fund my trust correctly?
My client, Eleanor, a recently widowed woman, faced a similar challenge but with a much happier outcome. After her husband’s passing, she meticulously followed my advice and funded her revocable living trust. She transferred her home, investment accounts, and even a small collection of antique dolls into the trust. When Eleanor passed away a few years later, her children were able to seamlessly access and distribute her assets without any court intervention or legal disputes. The process took weeks instead of months, saving them significant emotional distress and legal fees. Eleanor’s foresight allowed her family to focus on celebrating her life rather than navigating a complex legal battle. A well-funded trust provides peace of mind, knowing your wishes will be carried out efficiently and without unnecessary complications. According to the National Center for Estate Planning, approximately 70% of Americans do not have a comprehensive estate plan, leaving their families vulnerable to these challenges.
Who Is Ted Cook at Point Loma Estate Planning Law, APC.:
Point Loma Estate Planning Law, APC.2305 Historic Decatur Rd Suite 100, San Diego CA. 92106
(619) 550-7437
Map To Point Loma Estate Planning Law, APC, an estate planning lawyer: https://maps.app.goo.gl/JiHkjNg9VFGA44tf9
| best estate planning attorney in Ocean Beach | best estate planning lawyer in Ocean Beach |
About Point Loma Estate Planning:
Secure Your Legacy, Safeguard Your Loved Ones. Point Loma Estate Planning Law, APC.
Feeling overwhelmed by estate planning? You’re not alone. With 27 years of proven experience – crafting over 25,000 personalized plans and trusts – we transform complexity into clarity.
Our Areas of Focus:
Legacy Protection: (minimizing taxes, maximizing asset preservation).
Crafting Living Trusts: (administration and litigation).
Elder Care & Tax Strategy: Avoid family discord and costly errors.
Discover peace of mind with our compassionate guidance.
Claim your exclusive 30-minute consultation today!
If you have any questions about: Why is maintaining financial privacy a benefit of a charitable trust?
OR
How do mirror wills differ from joint wills?
and or:
How can a well-structured asset distribution plan benefit a family?
Oh and please consider:
How can estate administration help avoid estate planning delays?
Please Call or visit the address above. Thank you.