Topic: Trusts and Estates
While creating a trust is a great strategy for managing your estate in the event of your passing, unless your trust is “funded,” it will be of little value. Only trusts that are funded can keep your property out of probate court and accomplish the many things they are designed to do. To “fund” a trust simply means to transfer assets into them by changing the titles on any accounts, property, or beneficiary designations. An attorney can assist you with this process to ensure everything fully complies with California state law. Your attorney can also create a pour-over will that acts as a safety net in case you accidentally leave a property outside of your trust, though the probate process may apply.
Having a trust with you as the current trustee is called a “living trust.” A living trust will give you greater control than just having a will or property in joint ownership. Living trusts enable you to buy, sell, add, or remove assets as opposed to locking you into a “static” document that is difficult to adjust. Another key benefit of living trusts is the ability to leave an inheritance to your spouse without disinheriting your children or grandchildren. This can be an especially important feature when you have children from a previous marriage.
Funding a trust will involve some very specific legal paperwork and requires you to survey your belongings as well as consider what you want included. A good estate planning lawyer will be able to guide you through the entire process. He or she can explain to you the legal details that will affect whether you want to include or exclude particular assets. For example, there are certain factors that go into the decision to either designate an individual beneficiary to an insurance policy or make your trust the actual beneficiary. You may also want to transfer bank accounts, contents of a safety deposit box, certain kinds of stocks and bonds, life insurance equity, and notes payable to your trust. IRAs and some other retirement accounts, however, may be best excluded.
For assistance in both establishing and funding trusts in and around Orange County, consider the services of Mortensen & Reinheimer, PC. They have extensive experience in every aspect of estate planning and can help you fulfill your last wishes without undue delay or extraneous cost. To learn more, call Mortensen & Reinheimer, PC at (714) 384-6053 or fill out their online contact form.