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Which assets can you use to fund a living trust?

On Behalf of | Aug 2, 2021 | Trusts |

Contrary to popular belief, estate planning isn’t just for individuals of endless means. It’s instead something that everyone should do — and that may include funding a trust. 

Living trusts, and more specifically, revocable ones, have become increasingly popular for individuals to set up in recent years. You may be able to use some valuable items you have sitting around the house to fund this asset protection tool.

Why should I fund a trust?

People generally set up a trust for one of three reasons, including because they:

  • Want to leave items of value they have to their loved ones once they’ve passed away
  • Know that transferring assets to loved ones this way can afford them many tax-saving benefits
  • Are aiming to protect the trust’s assets and their creditors

Another benefit associated with most trusts is that your loved ones can often avoid having to wait for your assets to pass through probate if you place them into this asset protection tool. 

Which assets should I consider placing in a living trust?

Many people place valuable assets, including homes, gas, oil, intellectual property or mineral rights, bank accounts, stock dividends, cash, insurance policies and investment accounts, into their trust. 

Testators can also place other, less expensive items they have that they can also place into their living trust, though. These may include sports equipment, clothing, books, cameras or jewelry — essentially anything with significant value that you want to pass to your heirs without going through probate.

Is funding a living trust warranted in your situation?

Most testators want to preserve as many assets as possible to help support their loved ones once they’re gone. A living trust can help you do that, but other asset protection tools can help you accomplish the same result as well. You’ll want to familiarize yourself with the pros and cons of each before committing to any one of them. 

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