If you have a revocable living trust completed, you are already ahead of most Americans. The majority have not taken adequate steps to protect their wealth to ensure their loved ones are provided for in the event they pass away. However, having a signed and notarized revocable living trust is not the only component you need to verify. There are additional steps to ensure the estate planning process is complete. If you don’t yet have a turst, read our article on the difference between a Will and a Living Trust. We are here to help with our estate planning 101 guide to making sure your Living Trust works Effectively.
Estate Planning 101: Funding Your Trust
Trust funding is a necessary step where you transfer and allocate assets from your possession alone to ownership of the legal trust. A trust is a legal entity into which you inject your inheritable assets. This sets up your assets to be divided once you pass away. Specifically, you may have bank accounts that you want to be distributed upon your passing from the revocable living trust. To make this happen, the bank accounts must be named in the title of the trust.
Another example is whether you own a residence that you want to be distributed using the terms of the trust. To fund the trust, typically, a property deed is filed with the county recorder’s office transferring ownership from you to the trust itself. A trust is not considered complete unless it is properly funded with the assets listed in the trust.
Estate Planning 101: Trustee
A crucial part of the process of estate planning is trust administration. It is imperative to nominate people you have confidence in who will carry out your requests in the revocable trust (read here about an irrevocable trust) once you pass away. Trustees have legal obligations that they are bound to follow. A breach or deviation of their duties could result in liability against the trustee who breaches a legal duty. Have a meaningful conversation with people you want to nominate as a trustee. They will carry out the terms of the trust and distribute money as you wish. Consequently, this puts them in a position to fraudulently mishandle money to the trustee’s advantage.
The estate planning process can be complex and time-consuming. Having an attorney assist you with an estate plan can provide direction and relief for you in the process. Please contact BSS Legal if you would like assistance with your estate plan and we would be happy to tailor an effective solution for your needs.