Want more control over how your assets are passed down? A family trust might be the solution. Learn how they work and the typical steps involved in setting one up.
What Is a Family Trust?
A family trust is a legal entity that holds your assets during your lifetime and distributes them to your beneficiaries after your death, bypassing the lengthy and often expensive probate process. It gives you greater control over your legacy, provides privacy, and can protect assets from creditors and lawsuits.
There are two main types:
- Revocable Trusts: You maintain control and can make changes or revoke the trust.
- Irrevocable Trusts: Offers more protection, but you give up control once it’s set up.
Need help transferring your assets into your trust? We make trust funding easy, especially for California homeowners and vehicle owners.
Book a Consultation Today to finish your estate plan with confidence. Benefits of Setting Up a Family Trust
1. Avoid Probate
Probate is public, slow, and can be costly. A trust allows assets to pass directly to your heirs without court involvement.
2. Privacy
Wills become public record, but a trust remains private, keeping your financial matters confidential.
3. Control Over Distribution
You can set terms like age requirements or staged payouts, so your heirs receive what you intend, when you intend.
4. Protect Your Heirs
A trust can shield beneficiaries from creditors, lawsuits, divorce, or poor money management.
5. Plan for Incapacity
If you become incapacitated, your trustee can manage your affairs without needing a court-appointed conservatorship.
How a Trust Works
- Create the Trust Document: Usually with an estate planning attorney, outlining your wishes and naming beneficiaries and a trustee.
- Transfer Assets Into the Trust: Real estate, bank accounts, vehicles, and investments must be titled in the trust’s name.
- Manage the Trust During Your Lifetime: As the trustee (if revocable), you maintain full use and control.
- Distribute Assets Upon Death: Your successor trustee follows your instructions without probate.
Common Assets to Include in a Trust
- Real estate (home, rental properties)
- Vehicles (cars, RVs, boats)
- Bank accounts
- Life insurance policies
How to Fund Your Trust (And Why It’s Critical)
Many people make the mistake of creating a trust but never funding it. An unfunded trust won’t avoid probate. This is where trust funding services come in: they help retitle assets into your trust’s name correctly and legally.
Trust Funding Includes:
- Recording deeds for real estate
- Filing title transfers with the DMV
- Updating financial account ownership
Final Thoughts
Setting up a family trust is a proactive way to protect your legacy and ensure your loved ones are taken care of. But remember: a trust only works if it’s properly funded.
Need help transferring your assets into your trust? We make trust funding easy, especially for California homeowners and vehicle owners.
Book a Consultation Today to finish your estate plan with confidence.