Harrell, Stoebner & Russell, P.C. - business law
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Harrell, Stoebner & Russell, P.C. - business law
Call To Schedule A Consultation: 254-935-3036

Due to precautions related to COVID-19, we have expanded our options for remote consultations. Please contact our office to discuss whether a full phone consultation or video conference is appropriate for your situation.

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When should I fund my trust?

| Dec 28, 2020 | Estate Planning |

You have done the hard work of creating a trust that will hold assets for your children or whoever you want to inherit from you following your death. At the moment, you have not yet funded the trust. This is a key step to making your trust work, so you will want to figure out the best time to fund your trust.

People have differing priorities for their families. You might it find it more convenient to fund your trust now. Other people choose to fund a trust after they die. Here is a look at how both options can work.

Fund the trust during your life

You probably have good reasons to fund your trust now. If you wait too long, you may die before funding the trust, leaving your heirs with an empty trust that will pay nothing to them. Your assets will remain a part of your estate and will pass through probate.

Funding a trust is not always simple. As FindLaw points out, you will have to transfer the titles of some of your assets to the trust. Retirement accounts and real estate are two common examples. You would probably want to get it all done while you are in good health and can handle important financial and ownership transfers.

Fund the trust after your death

Transferring assets to a trust means you will lose a lot of control over them. You may want to maintain access to certain assets like your financial accounts or property that you own. If you still want your assets to go into your trust, you can set up a pour over will. This kind of will states that any assets remaining in your estate shall go into your trust following your death.

Using a pour over will does not come without risk. Like other wills, a pour over will does not avoid probate. This can make your heirs wait a little longer to receive their inheritance. They will also have to pay any necessary court expenses. You will have to weigh these factors as you make your decision.

 

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