Funding Your Trust: Asset Management And Avoiding Probate
In this article, you can discover:
- Why funding your trust is crucial for managing assets and avoiding probate.
- How neglecting to fund your trust can lead to probate and potential estate disputes.
- The common mistakes in estate planning, like relying solely on a will.
- The risks of self-managing estate documents without legal expertise.
What Is Funding My Trust, And How Do I Do It?
Funding a trust involves transferring assets into the trust’s name or designating the trust as a beneficiary. This process ensures that upon your passing, the trust manages these assets. Essential steps include opening a bank account in the trust’s name and, crucially, transferring real property, like your home, into the trust.
This action is vital as it prevents the need for probate court involvement for what is often an individual’s most significant asset. My role typically includes assisting in this funding process, offering recommendations, and drafting deeds to facilitate the transfer of real property into the trust.
What Happens If I Don’t Fund My Trust?
Assets not included in the trust at the time of your death will undergo the probate process. This results in increased expenses and time for beneficiaries to receive their inheritance. Additionally, it raises the risk of unintended individuals receiving parts of your estate.
What Are The Most Common Mistakes People Make With Estate Planning?
A prevalent error is relying solely on a will, whereas a combination of a will and a trust often better serves an individual’s intentions. Neglecting to plan for potential incapacitation is another oversight. It’s crucial to have a power of attorney, a medical power of attorney, and clearly expressed care preferences for scenarios of incapacitation.
What Are The Dangers Of Handling My Estate Planning Documents Without An Estate Planning Attorney?
Self-managing estate planning poses two primary risks. The first is the lack of comprehensive knowledge needed to align the plan with personal goals, often leading to inadequate coverage by documents like a will. The second risk involves misunderstanding the legal language and implications of these documents, which can lead to unintended consequences.
For more information on Funding A Trust In A Michigan Estate Plan, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (616) 300-1212 today.