While more and more people are setting up trusts as part of their estate plan, many people are failing to properly fund their trusts. As a result, many revocable living trusts fail. As a recent article explains, this failure leads to a person’s heirs spending unnecessary time and money for an unnecessary probate proceeding.
In order to create a revocable living trust, a person need only prepare and execute a declaration of trust. Through the declaration of trust, the trust creator – or grantor – determines and sets forth his or her desired terms and conditions for the trust. In order to remain in control of the assets, the grantor also designates himself or herself as the trustee
After the trust has been created, the grantor can transfer personal assets into it. This is known as funding the trust. Trusts can be funded with various assets, including real estate, bank accounts, retirement accounts, and life insurance policies. In order to put a piece of real estate into a trust, a person needs to execute and record a real property deed that transfers the real estate to the living trust. Accounts can be transferred to a trust by listing the trust as the desired beneficiary.
For assistance with creating or funding a trust, contact us at (626) 696-3145.
