People who create an estate plan in Oklahoma, Kansas or Missouri often ask us how they can fund a trust or have questions about the funding process itself. As you may know, the process of transferring personal property to a trust is known as funding. Any trust you create is useless unless you fund it properly. So today we are going to take a look at several ways to fund a trust and what you might have to do when using each method.
How to Fund a Trust: Assign Property
One of the simplest ways people fund their trusts is to use a property assignment, also known as an assignment of property, deed of trust, or something similar. An assignment is a document that provides the details needed to allow you to transfer specific property into a specific trust. Property assignments are most commonly associated with personal or tangible property that isn’t titled, but can also be used with other types of assets, such as intellectual property rights.
For example, let’s say you own a collection of antique phones. While these phones are valuable, they are not titled. To transfer these into your trust, you’d ask your attorney to draft an assignment that contains important details about the property and the trust. Once you sign the document, the trust becomes the owner of the identified property.
How to Fund a Trust: Transfer Ownership of a Bank Safe Deposit Box
Some people keep valuable or important property in a safe deposit box. A simple way to transfer ownership or control of these items to the trustee of your trust is to transfer ownership of the box itself.
For example, let’s say you keep important documents in your safe deposit box. You create a revocable living trust and name a successor trustee who will manage it if and when you lose capacity. If you transfer ownership of the box to the trust, you will control the documents while capable, and your successor trustee will be able to do so when necessary.
Transferring ownership of a safe deposit box will require you to contact your bank to find out what you need to do. The process typically includes signing a new signature card or filling out other simple forms.
How to Fund a Trust: Transfer Property Through Your Will
You can also fund a trust by including specific provisions in your last will and testament. For example, if you want to use your living trust as your primary inheritance device, you can create a pour-over will that transfers any remaining property in your name into the living trust after you die.