Funding a revocable living trust
If you are setting up a revocable trust, you will likely be the sole trustee of your trust. As the sole trustee, you can move assets into the trust and out of the trust at will, without too much hassle. Because of this, many people with revocable living trusts put a large portion of their assets to be held in trust, including real estate, financial accounts (stocks, bonds, etc.), and even bank accounts, such as a savings account.
To learn more about revocable trusts, see our article Revocable Trusts.
Funding an irrevocable living trust
By putting assets into an irrevocable trust, you are essentially giving up ownership and control of those assets, and so the assets that are used to fund an irrevocable living trust must be chosen carefully. Which assets will be used to fund an irrevocable living trust are generally determined by the goals of the trust. Choosing a funding method that supports the goals of the trust is something that you should decide with the help of a trust and estates attorney. Transferring property to an irrevocable living trust also requires that a formal transfer or property be completed, meaning that the property must be re-titled in the trustee’s name. An attorney can help you complete and manage a re-titling of property.
To learn more about irrevocable trusts, see our article Irrevocable Trusts.
Funding a testamentary trust
Testamentary trusts are generally funded only after your death, and are often funded with the assets of the your estate. In order to fund a testamentary trust, language in the will must explicitly state that all estate assets should be moved into the trust upon your death. The estate assets can then be distributed and managed according to the terms of the trust.
To learn more about testamentary trusts, see our article Testamentary Trusts.