Have You Funded Your Trust Yet?
THIS HANDY GUIDE MAKES IT EASY Hold the phone! Do we have your full attention? Hopefully so, because we’re about to ask a critical question: Have you registered your bank accounts in the name of your Trust? This process — called “funding your Trust” — involves changing the name on your bank accounts from your name to your Trust’s name, and it’s incredibly important. Why? Well, if your bank account isn’t registered in the name of your Trust, then its assets won’t be governed by your Trust — and all of your careful planning will be for nothing. You should have taken this critical step when you first created your Trust with us, but it’s possible you didn’t. The No. 1 Reason People Don’t Fund Their Trusts We provide a Certification of Trust and specific Funding Instructions to all of our Life PlanTM clients. These documents explain exactly how your assets should be titled. Many people intend to retitle their bank accounts but get tripped up when they reach out to their financial institution and discover it has nitpicky rules. For example, some banks limit the number of characters that can be used on account names — so your Trust’s name might not fit! Fortunately, there’s a way around this. You can abbreviate the Trust’s name to ensure your bank will accept it. The trick is ensuring you still correctly identify the Trust’s name, date, and Trustees. If you haven’t funded your Trust because of red tape, use the guide below to do it as soon as possible. How to Shorten the Name of Your Trust Say that your Certification of Trust states your assets should be titled as “John D. Smith and Jane P. Smith, Trustees of the SMITH TRUST DATED SEPTEMBER 13, 2010.” You can use the following rules to shorten it. • Instead of full names, use the first initials of your first and middle names. • Skip the punctuation. • Input the date numerically. • Drop “THE” before the Trust name. • Abbreviate “TRUST” to “TR.”
• •
Abbreviate “DATED” to “DTD.” Abbreviate “Trustees” to “Ttees.”
Applying these rules, John and Jane’s Trust title would become: “J D Smith and J P Smith Ttees SMITH TR DTD 9/13/10.” That’s usually short enough for the bank! The following shortcuts don’t apply to the Smith Trust in our example, but you might need to use them depending on your trust title. • Abbreviate “Survivor’s Trust Created Under” to “Sur Tr C/U.” • Abbreviate “FAMILY TRUST” to “FAM TR.” • Abbreviate “REVOCABLE TRUST” to “REV TR.” • Abbreviate “LIVING TRUST” to “LIV TR.” • Abbreviate “Under Agreement Dated” to “UAD.” Let Us Double-Check Your Work If you haven’t funded your Trust yet, call your bank right now or plan a visit to start the process. Be sure to bring this article, as well your Trust binder, ID, and co-trustee. You may have to abbreviate the name of your Trust, and if you do, ask whether the bank will use that abbreviated Trust title on your monthly account statement. If they will, request a letter or statement from the bank confirming the complete name of the Trust on file. Then, pass that note on to our Funding Department for verification. It doesn’t matter how long ago you created your Trust — as a Life Plan™ member, our Funding Department is always here to double-check your work! Call our office at 800-698-6918 and ask to start the asset verification process.
2 PrestonEstatePlanning.com
Made with FlippingBook Ebook Creator