Trust Funding: Crucial Step in the CA Estate Plan Creation Process

As you work toward completing the process of creating an estate plan in California, a vital step is to ensure that you properly fund your revocable living trust. Funding a trust is the process of moving your assets into the trust. This is often accomplished by transferring title to the asset into the name of the trustees of the trust or changing the beneficiary designations on certain assets. While it may seem like a lot of work to do this for all of your assets, it is important that it be done in order to take full advantage of the estate plan that you are creating. The following are five reasons to fund your trust during the estate plan creation process:

  • If you do not fund your revocable living trust while you are living, you may need to go through the probate process in order for your assets to be placed into the trust. A significant advantage of setting up and funding a revocable living trust is to avoid this hassle.
  • If you did not establish a pour-over will that puts your assets into the revocable living trust and you did not fund the trust during your lifetime, the assets may never reach the trust. 
  • Assets that are owned jointly with rights of survivorship will pass to the co-owner automatically without ever reaching the trust if they are not moved into the trust during your lifetime.
  • Similarly, assets that have beneficiary designations will not reach the trust unless the beneficiary is the revocable living trust.
  • Failing to fund a revocable living trust could cause you to miss an opportunity to take advantage of substantial estate or income tax savings techniques drafted into your trust.

Since funding is so important, it is important to seek the guidance of experienced Orange County estate planning attorneys. Call our office today at (714) 459-5481 for a consultation.

James F. Roberts
Founder and owner of the Law Office of James F. Roberts and Associates, a premiere estate planning law firm
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