Estate Planning

Putting Bank Accounts in Your Living Trust

By Jennifer Sawday

After you have established your Living Trust, one of the more important things you will need to do is fund your trust with your assets including bank accounts. This post only deals with bank accounts and not other assets that should also be included in a Living Trust. 

Once your Living Trust is set up, it is your job to contact all financial institutions where you have accounts to transfer those accounts to your trust. Here is a run down of what to expect.

1. Discuss with your attorney which accounts should be in your Living Trust. Sometimes not all financial accounts should be in your Living Trust.

2. For the accounts you have identified as belonging to your Living Trust, contact the financial institution and request that they re-title your existing account to your Living Trust.

3. Most financial institutions will want to see or keep a copy of the Living Trust on file. You can provide them with a Certification of Trust or a copy of the Living Trust -- depending on your comfort level.  Under California law they are supposed to honor a Certification of Trust in lieu of seeing the actual Living Trust document, but sometimes it is just easier to give the bank officer what they ask for rather than trying to drive home the legalities of the CA Probate Code Section 18100.5 as it relates to the Certification of Trust.

4. The account title should be updated in a manner that reflects how you have set up your Living Trust. For instance, "John Smith, Trustee of the John Smith Revocable Trust dated July 1, 2007."

5.  Not all banks will re-title accounts in a Living Trust. Some internet banks do not offer this option so be sure to check with the bank if you already have a Living Trust and plan to open a new account.

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Estate Planning, Probate and Trusts involve complex areas of law. Individual circumstances must be considered before any advice can be given.  The general information above is not to be construed as legal advice, which can only be given after consideration of the unique facts of each matter. Please seek the advice or counsel of your attorney, financial advisor or CPA as it may be appropriate.

Full post as published by Estate Planning Practice Blog on April 18, 2008 (boomark / email).