Berge & Berge, LLP Blog

Thursday, May 11, 2017

How to Fund a Living Trust

Today, estate planning is about more than having a will and getting your affairs in order before you die. Instead, it's a matter of planning for life, and many individuals are creating living trusts in order to protect their assets, plan for incapacity, provide for their loved ones, as well as to avoid probate. A revocable living trust, for example, is an estate planning tool that distributes assets to your beneficiaries after you pass away, but allows you to continue managing your affairs during your lifetime.

In any event, once a trust is in place, the trustee must transfer property into the trust. This is known as funding the trust. Generally, assets that should be placed into a trust include real estate, bank and savings accounts, stocks and other investments. These are known as titled assets that must be re-titled in the trust's name. If you want a living trust to contain your house, for example, it is necessary to prepare a new deed that is properly executed and recorded. If the deed is not prepared correctly, the property may be subject to the probate process.

Assets that are not titled, on the other hand, such as furnishings, family heirlooms, artwork, jewelry, and other personal property, can be transferred into the trust by preparing a general assignment of personal property. In any event, by failing to properly transfer property into the trust, it may be subject to a probate proceeding.

What is a Pour-over Will?

Occasionally life circumstances may result in some assets remaining outside of the trust. For this reason, it is also necessary to create a Pour-over Will. This is essentially a backup mechanism that will ensure assets are properly transferred to your trust if funding was not completed or property was acquired after the trust was created. In short, these assets pass through the will and are "poured" into the trust.

The Takeaway

Ultimately, a living trust is a convenient means of passing assets to your beneficiaries and avoiding probate. In fact, this estate planning tool has become increasingly common in California. Nonetheless, funding the trust should be an ongoing process so that all the assets you acquire during your lifetime are properly transferred into the trust.

By engaging the services of an experienced trusts and estates planning attorney, you can have peace of mind knowing that your living trust has been properly structured and funded.

Archived Posts


Estate Planning and Elder Law News

© 2019 Law Offices of Berge & Berge LLP | Disclaimer
1101 S. Winchester Blvd, Suite I-208, San Jose, CA 95128
| Phone: (408) 389-6980

The LifePlan Program | Estate Planning | Estate Tax Planning | Business Succession Planning | Probate / Estate Administration | Elder Abuse/Conservatorships | Trust and Estate Planning | Public Benefits | Special Needs Planning | Trust Administration | | About Us | Forms | Resources

Law Firm Website Design by
Amicus Creative