You Created a Living Trust, But Did You Put Anything in It?

You met with an attorney, signed your Florida revocable living trust, and went home thinking your estate would avoid probate.  But there is one more very important step:  Did you actually transfer your assets into the trust?  Creating a trust and funding a trust are two different things. 

What Does It Mean to “Fund” a Living Trust?  Funding simply means properly connecting your assets to your estate plan.

Depending on the asset and your individual plan, that may involve changing ownership to your trust or coordinating beneficiary designations and other probate-avoidance strategies.

For example, your attorney may recommend transferring certain:

• Real estate

• Bank accounts

• Investment accounts

• Business interests

But not every asset belongs in a revocable trust, which is why funding should be done as part of an overall estate plan.

What Happens If You Don't Fund Your Trust?

Here's a simple example.  Maria creates a revocable living trust stating that everything will eventually pass to her two children. But she never transfers an individually owned investment account into the trust and never adds a beneficiary designation to that account.

When Maria dies, the account doesn't automatically become trust property simply because her trust says who should inherit.  That asset may still require Florida probate before it can ultimately reach the intended beneficiaries.

Individuals who do not fully fund their trusts may end up needing both a probate administration AND a trust administration after death costing their families thousands of dollars unnecessarily.

Should I Put My Florida Home Into My Trust?   Maybe, but don't change the deed yourself.

Florida homestead property has special constitutional and statutory protections. Mortgages, homestead restrictions, tax exemptions, creditor protection, and family circumstances should all be considered before changing title.

The Florida Bar specifically recommends having an attorney address the deed when real estate is being transferred into a trust.

The important lesson is simple, signing your trust isn't the end of your estate plan.

Review how your assets are titled, check your beneficiary designations, and update your plan when you buy new property or open significant new accounts.

A properly drafted trust can be a powerful estate-planning tool, but a trust can only control the assets that are properly connected to it.

At Arevalo Law, we help Florida families create and fund estate plans designed to work not only on paper, but when their families actually need them.