Providing the Guidance You & Your Family Need
What does "funding" mean?
Typically, the term “funding” refers to the transfer of assets into a trust. Funding is an essential and ongoing part of the estate planning process. If your estate plan isn’t properly funded, it won’t work, meaning it won’t do what you want it to do. Funding is an essential and ongoing part of the estate planning process.
Why is funding important?
Funding is an essential and ongoing part of the estate planning process. Typically, the term “funding” refers to the transfer of assets into a trust. If your estate plan isn’t properly funded, it won’t work, meaning it won’t do what you want it to do. Or, if you want your will to control distributions to your children, you must own those assets in your individual name.
How can I be sure my trust stays funded?
This is such a good question because it’s imperative that you keep assets in your trust if you want your estate plan to work. If you have asset titling questions, we’re always here to help. That support is included in your client maintenance membership. Also, be sure you come in for our annual meeting during which we’ll review your assets and make sure proper asset ownership has been maintained.
Do I need to let my attorney know when I purchase a new asset?
If you have asset titling questions, we’re always here to help. That support is included in your client maintenance membership. In addition, we’ll give you a card with the name of your trust so you can just hand that to the bank or investment advisor when you open a new account. You don’t need to worry about retitling any personal assets that don’t have a title such as new furniture, appliances, or roller skates.
What does "proper asset ownership" mean?
Proper asset ownership refers to aligning your assets with your estate plan. For example, if you want your trustee to be able to manage assets, those assets must be owned by your trust. Or, if you want your will to control distributions to your children, you must own those assets in your individual name. Proper asset ownership, sometimes referred to as “funding,” is an essential and ongoing part of the estate planning process.
What does “tenants in common" mean?
Tenants in common is a form of joint ownership in which the owners can own equal or unequal portions of the property. For example, Sally, Jane, and Sue own a beach house together as tenants in common. Sally is a 20% owner, Jane is a 30% owner, and Sue is a 50% owner in the beach house. There is no survivorship feature so when Sally dies in a boating accident, her 20% ownership in the beach house will pass to whomever she names in her will or trust (or by state law if there is not will or trust), not necessarily Jane and Sue.
What is joint tenancy with right-of-survivorship?
JTWROS is a form of joint ownership with a survivorship feature. Two or more people own an asset together and the survivor of them owns the property outright. For example, Joe and Sam own a house as joint tenants with a right-of-survivorship. Joe dies in a skiing accident. Now, Sam owns the house automatically by operation of law. There’s some “lawyer math” included in JTWROS. Each owner owns 100% of the property, no matter how many joint tenants there are, 2 or 20.
Should I put my children's name on my bank account?
No. We can help you authorize your children to help manage your assets and pay your bills. We can even help you avoid paying probate fees and reduce any transfer taxes, but, no, don’t put your children’s names on your bank accounts or house to avoid common problems such as horrid tax implications, creditor seizure, stealing, and family discord. We’d be happy to help you reach your goals with minimal risk.
Do I have to name my spouse as the beneficiary of my retirement account?
Yes and no. Yes, you can name someone else or a trust as the beneficiary of your retirement account. For example, some of our clients name their revocable trust as the beneficiary, but in order to do so, you must have your spouse’s written permission.
What if I end up using up my retirement account during my lifetime?
By all means, use your retirement funds as you think best. Even after you set up a standalone retirement trust, you’ll have full control and the right to enjoy your retirement funds for years. However, if you’re like most people, you will still have assets in your retirement account when you die; that’s when the SRT - standalone retirement trust - will protect your loved ones and their inheritance.
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