Happy Wednesday! This week we are discussing things that can slip through the cracks.
We administer many probates each year where clients end up dealing with the courts despite the fact that they established a trust. A Revocable Living Trust is an excellent way to keep your family out of probate, detail when and how your family will receive distributions, save on estate taxes, and even create creditor protection for your children. The most important part of the trust however, is that you actually complete the funding process. Funding consists of re-titling your assets in the name of your trust and/or making sure that you properly complete your beneficiary designation form.
Here are the biggest mistakes we see when it comes to properly funding your trust:
Failing to transfer real estate into your trust, especially if you own property in a different state;
Failing to complete beneficiary designation forms on items such as life insurance or retirement policies; and
Failing to transfer bank accounts in your trust.
The bottom line is that if you pass away with items solely in your name, or items without a beneficiary designation, your family will be dealing with the probate court. Just because the trust was executed does not mean you automatically have probate avoidance. It is the funding process that keeps you out of court.
So, has it been a few years since you reviewed your assets and how they’re titled? Have you created a trust and are unsure whether you’ve funded it? Do you know that it’s time to get a trust in place to keep your family out of the probate court? If any of these apply, or you’re just feeling like you need a check-up, please contact us today. Let’s make sure we have all of your assets organized for a smooth transition.