Funding Your Trust: How to Transfer Assets to a Trust
Creating a Trust is a crucial step in managing your estate and ensuring your assets are distributed according to your wishes. However, it’s important to note that simply creating a trust document isn’t sufficient. Transferring assets to your Trust—often referred to as "funding" your Trust—involves legally retitling your assets from your name to the name of your Trust.
If you need information on adding assets to a Will, please refer to this guide: How to Add Assets to a Will.
Why is transferring assets to my Trust important?
Transferring assets to your Trust is a vital process that directly affects how these assets are managed and distributed after your passing. The Living Trust document specifies how assets held within the Trust will be distributed, meaning only the assets successfully transferred to the Trust are included. Assets that remain outside the Trust are not governed by its terms and typically must go through probate, which can be a lengthy and costly legal process.
Benefits of Transferring Assets to the Trust
Avoiding Probate: Assets transferred to the Trust bypass the probate process, significantly reducing the time and costs associated with distributing your assets after your death.
Maintaining Control: As the primary trustee, you retain control over the assets in your Trust while you're alive. This allows you to manage, invest, and distribute these assets according to the Trust's terms without relinquishing authority over them.
Ensuring Privacy: The probate process is public, making the distribution of your assets a matter of public record. In contrast, assets within a Trust are distributed privately according to your wishes, without the need for probate.
How to Transfer Assets to Your Trust
Transferring assets to your Trust involves legally changing the title of your assets from your name to that of your Trust. The process varies depending on the type of asset and whether it has a deed or title.
For Tangible Assets Without Deeds or Titles:
Most tangible assets without deeds or titles—such as clothing, furniture, jewelry, and electronics—can be transferred to your Trust using a blanket transfer document. This document streamlines the process for these types of assets.
For Assets With Deeds or Titles:
Assets that have deeds or titles, like real estate and vehicles, require a more formal transfer process. This typically involves creating and recording new deeds for real estate or working with your local DMV for vehicles to reflect the Trust as the new owner.
More Information About Funding Your Trust
For detailed instructions on transferring specific types of assets to your Trust, check out the helpful trust-funding guide available in our Learn Center. This resource offers step-by-step guidance tailored to different asset types, ensuring you can effectively transfer your assets into your Trust.
Here are some related articles about transferring specific assets to your Trust:
- Real Estate
- Checking, Savings, and Other Bank Accounts
- Personal Property Without Titles or Deeds
- Life Insurance Policies
- Retirement Accounts
- Vehicles
- Sole Proprietorship Assets
- Partnerships, LLCs, or Corporations
- Oil, Gas, and Mineral Rights