How do I fund a trust?

Funding a trust is a fairly straightforward process but requires some strategic planning and forethought. In Florida, the law requires that the grantor or creator of the trust legally transfer the ownership of the assets to the trust. This is done through a written instrument known as a Declaration of Trust. In this document the grantor states their intention to create the trust and the provisions therein. The next step in the process is to decide what type of assets should be placed inside the trust. Common choices are cash, stocks, bonds, real estate, and other tangible and intangible assets. Once the type of assets are selected, the transfer of the ownership of these assets to the trust is made official. Depending on the type of asset, this may involve a deed, stock certificate, or other document which officially changes the ownership to be in the name of the trust. The trust must also be funded with enough cash to cover administrative costs such as taxes and filing fees. Any surplus will be available to the trust income and principal for the benefit of the beneficiary or beneficiaries. Finally, the trust must be managed correctly. This requires the settlor to select a fiduciary who is responsible for managing the trust according to the instructions outlined in the trust instrument. The settlor must also name beneficiaries who will be eligible to receive any assets, income, or benefits from the trust. By following these steps, you can ensure that your trust is properly funded and managed.

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