You’ve set up a trust. That’s great. But if you think the hard work is done, I need to tell you something important: creating the trust document is actually just the beginning. The real challenge is funding it properly, and this is where so many families get tripped up.
The Step Everyone Forgets
Think of a trust like a container. You can build the most sophisticated, legally sound container in the world, but if you don’t put anything inside it, what’s the point? Trust funding means transferring ownership of your property into the trust’s name. We’re talking about real estate, bank accounts, investments, and other valuable assets. When people skip this step or mess it up, their families deal with the consequences later. At Hirani Law, we’ve watched too many well-intentioned estate plans unravel because someone didn’t complete the funding process. These mistakes are absolutely preventable. You just need to know what to watch for.
The Mistakes That Happen Most Often
Leaving Real Estate Out of the Trust
Your home is probably your most valuable asset. Yet it’s surprisingly common to find real estate still titled in someone’s personal name instead of their trust. When that happens, the property has to go through probate anyway. You’ve basically defeated the entire purpose of creating a trust in the first place. Florida property owners need to execute and record a deed. This deed transfers ownership from your name to the trust’s name. It’s not complicated, but it won’t happen automatically. Without this recorded deed, your home or investment properties sit outside the trust’s protection.
Forgetting to Retitle Financial Accounts
Bank accounts need updating. So do brokerage accounts and certificates of deposit. A lot of people think mentioning these accounts in the trust document is enough, it’s not. Each financial institution has its own forms. They have their own procedures. You’ll need to work with each one individually to change the account ownership to your trust’s name. Some accounts get missed entirely. People open new accounts after they’ve created their trust and forget to title them correctly from the start. Working with a Winter Park trust lawyer helps you keep track of which assets actually belong in your trust and which ones still need attention.
Mishandling Retirement Accounts
This one can cost you big time. Retirement accounts like IRAs and 401(k)s generally shouldn’t be retitled in your trust’s name while you’re alive. The tax consequences can be severe. Instead, you’ll typically name the trust as a beneficiary. If you transfer ownership directly, you might trigger immediate taxation on the entire account balance. That’s a mistake that could wipe out a huge portion of what you intended to leave your beneficiaries. The rules around retirement accounts and trusts get technical fast. You don’t want to figure this out through trial and error.
Ignoring Personal Property
Furniture doesn’t seem like a big deal. Neither does jewelry, artwork, or your vehicle collection. But these items still need proper transfer documentation. Some states allow you to use a bill of sale or assignment document to move personal property into your trust. People often overlook this category entirely because individual items don’t carry the same value as a house or investment portfolio. But collectively? They can represent significant worth.
What It Costs When You Get It Wrong
Assets that stay outside your trust create problems:
- You’ll end up in probate court for those untitled assets
- Court fees and attorney costs eat into what you’re leaving behind
- Your beneficiaries wait months or even years to receive anything
- Privacy goes out the window since probate records are public
- Family disagreements tend to surface during lengthy court processes
These are exactly the issues you were trying to avoid by creating a trust. Families find themselves stuck in court proceedings during what’s already an incredibly difficult time. Nobody wants that.
Your Trust Needs Regular Attention
Here’s something else people don’t realize. Trust funding isn’t something you do once and forget about. Life changes. You buy a new house. You open another investment account. You inherit money from a relative. Each time you acquire a new asset, you need to think about your trust. Does this need to be titled in the trust’s name? Should it be? Regular check-ins with your Winter Park trust lawyer help you catch any gaps before they become problems. Your estate plan should evolve as your life does.
You Can Fix This
Don’t let funding oversights undermine everything you’ve worked to build. Taking the time now to properly fund your trust protects your family’s financial future when they need it most. Reach out to our team for a thorough review of your trust to make certain all your assets are correctly titled and ready for smooth transfer to your beneficiaries.