For parents who want to protect their children in all eventualities, trusts offer a host of benefits that wills don’t. With this arrangement, you can stipulate when the assets are released and how they’re to be used. If you’ve decided to create one for your children but are unsure how to fund them, use this guide to get started.
3 Assets That Can Fund a Living Trust
1. Stocks & Bonds
Investments don’t stop appreciating if they’re put in a living trust. As such, you’ve got nothing to lose by transferring your stocks and bonds if the assets were intended for your children anyway.
There are a few ways to fund a trust with assets held in certificate form. The easiest is by creating a brokerage account under the name of the trust, then depositing the original certificates in it.
2. Cash Accounts
If you’ve opened any checking or savings accounts for your children, use them to fund their trusts. Money markets and CDs can also be placed into trusts. Just make sure the financial institution doesn’t consider retitling the CD a withdrawal, as this can result in penalties. If they do, wait until the CD matures to make the transfer. After putting applicable cash accounts into the trusts, consider what you want your children to use the funds for, so you can implement any necessary stipulations.
3. Personal Property
People are often surprised to learn they can use valuable belongings, like jewelry, artwork, and musical instruments, to fund trusts. An estate planning attorney can help you determine the value of these items so that the terms of the trust are totally comprehensive. When deciding what kind of property to add, consider what may mean the most to your future generations.
If you want help creating and funding a trust, turn to Ng & Niebling in Honolulu, HI. These estate planning attorneys have helped families preserve their legacies for over 40 years. They’ll take the time to review your assets and walk you through every step of the process. To schedule a consultation or to get more information about how they can help, call (808) 732-7788.