To avoid probate many families have their estate planning attorney create a trust, which is like a bucket a person or family carries through life.
While carrying the
“trust bucket” they can decide what they’d like to place into it, thus “funding” the trust.
They can also decide who should carry the bucket for them should they become unable to do so,
and also how the assets within the bucket should be distributed when they die.
If a trust is not funded when someone dies, then the probate court must decide how to distribute any assets involved and the family will incur the costs associated.
Read case study...
As a follow-up to our "tongue-in-cheek" April Fool's Day post, here's an example of an estate planning attorney who drafted a trust, but didn’t assist with any of the funding. The client thought he and his family were "all set" because they had a trust.
Unfortunately, an unexpected heart attack claimed the client's life, and as it turned out, everything was not "all set." There was nothing in his trust and all of his assets went through probate. His probate estate incurred $20,000.00+ in legal fees to go through the probate process.
Without funding your trust with assets, your trust will not accomplish your goal of avoiding probate and of making it easier and less expensive for your loved ones and beneficiaries down the road.
