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It is important to fund a revocable trust

On Behalf of | Dec 9, 2021 | Estate Planning |

Many San Jose area residents have taken the time to create an estate plan to protect their assets. One part of the estate plan often includes a revocable trust. This type of trust can help an executor transfer assets upon their death in order to avoid probate. But creating a revocable trust document is not enough. The trust also needs to be funded.

The main goal of any estate plan is to transfer a person’s assets to their heirs as simply as possible. People often use revocable trusts to avoid probate and to provide a structured way to manage assets upon their death. But a revocable trust only controls assets that are placed into it. The trustee has no control over assets that are not in the trust which means those assets will need to go through probate court.

Funding the trust involves:

  • Changing the titles of assets from a person’s individual name to the name of the trust.
  • A financial account may require proof of the trust.
  • Real property is transferred using a quit-claim deed in the county land records.
  • With untitled property an executor can issue an assignment of property designating the trust as the owner of those assets.

A pour-over will often accompanies a revocable trust. It acts as a safety net in case an asset is left out of the trust but that property will have to go through probate before it is transferred into a trust. A legal professional who is skilled in estate planning can help form a revocable trust for their client and also make sure the trust is funded. They will make sure the trustee has the full power to manage the trust assets and that the assets will go where the trust founder intended.