Estate Planning Gone Wrong
A Revocable Living Trust is often used to complement a Will. Rather than only having a Will, the Revocable Trust generally avoids the expensive and costly Probate process. In Florida the fee the Florida Legislature has deemed as reasonable is 3% of the total estate. The Revocable Living Trust also generally protects the assets from most creditors of the estate.
A Revocable Living Trust enables your beneficiaries to receive your assets sparing any complications. However, if the Revocable Living Trust is not properly funded, then it would not do any good.
Funding the trust is simply the process of transferring assets to it. Essentially, you must change legal ownership of your assets from your name into the trust’s name, such as real estate. This also means you’ll have to change most beneficiary designations for Life Insurance policies, 401k and retirement accounts. It is not recommended to place the 401k and retirement accounts directly into the Revocable Living Trust for tax and structure consequences.
If you don’t properly transfer assets to the trust, you will not avoid Probate.
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