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Are you considering including a Trust as part of your estate plan? It's a wise decision that can help you avoid probate, maintain privacy, and ensure the proper distribution of your assets to your loved ones. However, simply creating a Trust is not enough. To make your Trust effective, it needs to be funded properly and regularly updated. Make sure to avoid these mistakes in estate planning!
Funding your Trust involves transferring ownership of your assets from your name to the name of your Trust. This includes bank accounts, investments, real estate, and valuable possessions. By funding your Trust correctly, you ensure that your assets are managed according to the terms of your Trust and will be distributed as per your wishes upon your death or incapacity.
On the other hand, if you fail to fund your Trust, it becomes an empty vessel with no protection or proper distribution of assets. While your assets can still be included in your Trust after your death, it would require going through a costly probate process. To avoid this, it's crucial to work with an attorney who will ensure that all the necessary assets are transferred into your Trust.
Forgetting to Update Your Account Beneficiaries
Another common mistake in estate planning is forgetting to update the beneficiaries on your financial accounts. Many people believe that their Will or Trust alone determines how their accounts will be distributed after their death. However, the beneficiary designations on your accounts supersede any instructions in your Will or Trust. Therefore, it's essential to review and update the beneficiaries on your accounts, ensuring that your Trust is named as the designated beneficiary unless you have specific plans for a particular account.
Your Attorney Didn’t Move Your Home Into Your Trust
Your home is often your most valuable asset, and failing to transfer it into your Trust can have serious consequences. If your attorney overlooks this step or if you use an online DIY service without legal guidance, your home may not be included under the terms of your Trust. This could lead to a lengthy and expensive probate process, causing a financial loss for your family. Ensure that your attorney deeds your home into your Trust to avoid such complications.
Not Reviewing Your Plan and Accounts Every Three Years
Regularly reviewing your estate plan and accounts is vital. Neglecting this step can result in significant issues for you and your family, rendering your Trust ineffective. Your Trust can only control assets listed under its ownership or beneficiaries. By reviewing your accounts every three years, you can catch any oversights, such as accounts that are not titled in the name of your Trust.
Make Sure All of Your Assets Are Included In Your Plan with Help From Your Personal Family Lawyer®
To ensure that all your assets are included in your estate plan and that they work together seamlessly, it's crucial to work with an experienced estate planning attorney. They will help you create a comprehensive plan that considers all your assets and ensures proper titling. Additionally, they can offer free reviews of your plan and financial accounts every three years, keeping everything up to date.
If you're interested in learning more about funding your Trust and avoiding planning pitfalls, schedule a free 15-minute discovery call with us. We are dedicated to helping you make informed decisions about your estate and loved ones.
Want to read more about estate plans? Check out our blog at www.tlfinneylaw.com/blog/
This article is provided by the Law Office of Tanika L. Finney, a Personal Family Lawyer® Firm. We specialize in guiding you through important decisions about life and death, ensuring that you and your loved ones are well taken care of. Contact our office today to schedule a Peace of Mind Planning Session and gain financial organization and make the best choices for your family's future. Please note that this content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms and is intended for educational purposes only. For specific legal advice, please consult a professional.
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