How To Fund A Trust The Right Way!

Funding a trust means legally transferring your assets into the trust’s name—like retitling bank and investment accounts, recording real estate deeds, and updating beneficiary designations. If you don’t fund it properly, those assets may still require probate and your trust may not carry out your intended plan. This article explains what it means to fund a trust, step-by-step methods by asset type, common mistakes to avoid, and how to confirm your trust is fully funded.

Ray Hrdlicka – Host – Attorneys.Media

Okay, well let’s talk about funding the trust.

What does that mean?

Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA

All right, the point of a trust is to have all your assets there and not outside the trust.

So, funding the trust simply means you add all the assets that you have into the trust.

And how do we know that something’s in the trust?

It’s titled in the trust.

By that, the shorthand is: instead of you as an individual, it’s you as the trustee of the trust.

So there’s a clear statement that you’re giving it to the trust and you don’t have it outside the trust.

It’s easy.

Like I said, I’ll do the grant deeds for clients with their properties just to make sure.

Because I had a bad experience with a client who insisted she would do it; I should have known better.

I couldn’t make her have me do it for her, but she ended up not doing it.

So, we had to file a petition with the court because it was identified as a trust.

I did her trust, so I did identify it as a trust, stated she’d given it to herself as the trustee of the trust, but we didn’t change title and I had to get a court order.

So, there was an additional expense—not a huge amount, but it was money that wasn’t available to give to her beneficiaries, which is really the plan.

So, that’s why you fund the trust.

Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA