Many estate planning mistakes in California can be avoided by hiring a Pasadena estate planning law firm to assist you with the creation and updating of your documents. This includes failing to fund a trust. A trust is a powerful estate planning tool that allows you to protect your assets and exert some control over how they are distributed. However, one of the most common estate planning mistakes is failing to fund the trust.
Funding the trust refers to properly retitling assets so that they are truly owned by the trust and not by the individual. Setting up a trust is not the last step involved in funding the trust. Without funding a trust, individuals face untapped potential since creating a trust without appropriately transferring the assets renders the trust mostly useless. Failing to fund a trust can also lead to court intervention due to the loss of things such as reduced estate taxes or avoiding probate, which can both occur with improper trust funding.
Finally, asset safety is a concern since titling assets in your name alone can also leave them exposed to creditors or people who may file a lawsuit. Probate fees may apply for those assets that end up in your individual name and estate rather than your trust, and estate taxes on certain things left in your personal name, such as stocks, could have been more easily protected inside a trust. Talk to an experienced and dedicated estate planning lawyer today to learn more about how to approach your estate plan.
