When creating an estate plan, it’s important to understand all your options in these matters. Unfortunately, many assume their planning stops at creating a will, without realizing the benefits of establishing other documents. For example, one thing you may not have considered is creating a living trust. This has many benefits that can help you protect your assets. However, many are unsure of how to fund a living trust after they decide to establish one. If you’re interested in creating a fund but aren’t sure how to transfer assets into it, you’ll want to keep reading. Additionally, you’ll discover how PA trust attorneys can help you ensure your plan reflects your needs.
What is a living trust?
A living trust is a kind of trust fund that is created with the intention of holding assets during the creator’s lifetime so the assets held may be distributed upon their passing. Generally, once a trust fund is created, it takes immediate effect, unlike a will, which does not take effect until the creator has passed away. For a revocable living trust, the creator typically names themselves as the trustee or person responsible for managing the trust. However, you’ll need to name a successor trustee to assume the role if you become incapacitated or pass away.
Often, a living trust is used to protect assets, as you’ll find that if you are sued, for example, the assets held in a trust are protected. This is because they do not technically belong to you, but they are owned by the trust fund. Additionally, creating a living trust allows your beneficiaries to avoid probate upon your passing. Probate is a lengthy and often overwhelming process for many, so creating a trust fund can help your loved ones avoid this process.
What must I do to fund my living trust?
To fund a trust, you must transfer assets into the fund. This can include stocks, real estate, bank accounts, or physical property. Generally, this process involves contacting different institutions to get the correct forms to transfer ownership. For example, if you want to transfer a bank account to your trust, you’ll need to directly contact your bank to obtain the necessary documents. You may be asked to submit a copy of the trust and complete a “Certificate of Trust” form. Additionally, you’ll need the bank to “title” your bank account in the name of the trustee.
Similarly, for items like jewelry or furniture, you may be unsure how to transfer these, as they do not have a title or deed. As such, you can still complete a general transfer document to ensure these assets are protected.
As you can see, creating and funding a living trust can be a complex matter. That is why it is imperative to connect with an experienced attorney who can assist you through these issues to ensure you have peace of mind that your loved ones and assets will be cared for upon your passing. Connect with us today to learn more about how we can help you through these matters.
