I’ve seen it happen time and time again.
A family sits down with an attorney, proud of their comprehensive will and trust. They believe they've done everything right, thinking their family's future is secure.
But they've missed the single most critical step in the entire process.
They've forgotten to fund their trust.
What Is Trust Funding, and Why Is It So Important?
Think of your trust as a secure vault you’ve built to protect your assets—your home, your savings, your investments. But a trust is just an empty box until you put things inside it.
Funding the trust means legally transferring the ownership of your assets from your name to the name of the trust. For example, instead of the title to your home being in "John and Jane Smith," it would be in "The Smith Family Trust."
Without this crucial step, your trust is essentially useless. When you pass away, those assets are still legally in your name, which means they’re subject to the long, expensive, and public process of probate.
Probate can tie up your family's inheritance for months or even years, racking up costly legal fees and exposing your private financial details to the public. It's the exact outcome you created a trust to avoid.
The Simple Fix That Provides Peace and Protection
The good news is that funding your trust is a straightforward process. Here’s what you need to do:
Real Estate: Change the deed to your property so the trust is the new owner.
Bank and Brokerage Accounts: Re-title your accounts to the name of the trust. This can be as simple as filling out a new form at your bank.
Investments: Change the ownership of your investment accounts, stocks, and bonds to the trust's name.
This isn’t a one-time task. You need to be diligent about it as you acquire new assets. Bought a new vacation home or opened a new investment account? Make sure to add it to your trust right away.
The Bottom Line
A will is a plan, but a trust is an action. A fully funded trust ensures that your wishes are executed smoothly and privately, protecting your family from unnecessary stress and expense during an already difficult time.
Don't let your thoughtful estate plan become a costly mistake. Take the time to fund your trust and give your family the peace of mind they deserve.
Have you checked if your trust is fully funded? What questions do you have about this process?