If you've created a revocable living trust, you're on the right path to building a comprehensive estate plan. However, many people mistakenly believe that simply having a trust guarantees they'll avoid probate. Unfortunately, that's not always the case. The key to probate avoidance lies in properly funding your trust and ensuring your assets are aligned with your estate plan.

What Goes Through Probate?

Your loved ones may have to navigate the probate process if certain assets are not appropriately titled or lack beneficiary designations. Assets that typically require probate include:

• Accounts and real estate titled in your sole name (without payable-on-death (POD) or transfer-on-death (TOD) designations)
• Jointly owned accounts and real estate held as tenants in common
• Retirement accounts without named beneficiaries
• Life insurance policies without named beneficiaries

How to Avoid Probate with a Trust

Certain assets can avoid probate automatically, even if they are not funded into your trust. Here are the types of accounts and property that bypass probate:

• Jointly owned property with rights of survivorship: The surviving owner automatically inherits the property.
• Married couples' property owned as tenants by the entirety: The surviving spouse becomes the sole owner upon death.
• Life insurance with a named beneficiary: You can also name your trust as the beneficiary to funnel proceeds into the trust.
• Retirement accounts, 401(k)s, and annuities: These accounts avoid probate if a beneficiary is named.
• POD/TOD accounts and TOD deeds for real estate: These designations transfer assets directly to beneficiaries.

What Happens If You Forget to Fund Your Trust?

Life changes can cause you to overlook funding certain assets into your trust. If any account or property is left out, your loved ones may need to go through probate. However, if you have a pour-over will, the probate court will transfer any unfunded assets into your trust, ensuring your estate is ultimately managed according to your trust's instructions.

Although probate may be required, the ultimate goal of transferring assets into the trust is still achieved.

Next Steps: Ensure Your Trust Is Fully Funded

To ensure your revocable living trust helps you avoid probate, work with an experienced estate planning attorney to confirm that all your accounts and property are properly titled or designated with beneficiaries. Remember, creating a trust is just the first step—ensuring proper asset ownership is the key to probate avoidance.

Contact us today to review your trust and estate plan for complete probate protection.