If you have established a revocable living trust in your estate plan, you may assume that your estate is automatically protected and immune from the hassle of probate. However, this is not necessarily true, as you must ensure you explicitly fund this living trust with your assets. Without further ado, please continue reading to learn the most common trust funding mistakes you might want to avoid at all costs and how one of the experienced Butler County trust attorneys at Heritage Elder Law & Estate Planning, LLC can do everything in their power to prevent your estate plan from being derailed in any way.

What does it mean to fund a trust, and why is it so important?

As alluded to above, the first trust funding mistake you can make is not properly funding it in the first place. That is, to fund a trust, you must transfer ownership of your assets from your individual name into your trust’s name. So, for large assets like real estate property or motor vehicles, this entails retitling and filing the updated title with the appropriate entity. And as far as personal belongings go, you may be expected to create a personal property memorandum or assignment document, which should list the items and then be attached to your trust document. Otherwise, if these assets are not in your trust’s name, your trust cannot manage or distribute them upon your passing, forcing this responsibility onto the Pennsylvania probate court.

What are common trust funding mistakes that might derail my estate plan?

Even if you have already settled the transfer of assets to your trust properly, there may be extenuating measures, depending on the type of asset in question, that you may execute incorrectly. Nonetheless, below are other common trust funding mistakes that might derail its effectiveness in your estate plan:

  • You may forget to update your business operating agreements before transferring your business interests, and complicate ownership succession.
  • You may forget to send notice to your mortgage lender and insurance company when retitling your home, triggering term violations.
  • You may retitle retirement accounts in your trust’s name and trigger considerable taxes, instead of naming it as a beneficiary.
  • You may forget to add more funding to your trust when buying a new property or receiving an inheritance, leaving these things vulnerable to probate.

You should not let the pressure of creating a valid and enforceable estate plan rest solely on your shoulders. Please allow one of the skilled Butler County estate planning attorneys from Heritage Elder Law & Estate Planning, LLC to assist you throughout this process. We look forward to helping you set up your trust and then guiding you in funding it. Give us a call today.