I like to call our meeting room where we meet to discuss estate planning “the pause room.” When we enter and close the door, and leave outside all the busy-ness in our lives — we put only the matters relating to estate planning on the table. We pause for about an hour, and concentrate solely on one very important matter.
When we come out and re-enter the busy-ness of life, it’s easy to forget what we just discussed in “the pause room.” After completing the estate plan, your attorney might provide a letter suggesting that certain assets be directed to, or placed into trust. This is called “funding” the trust — it is just as important as creating the trust in the first place, and making sure that the right beneficiary receives the right asset. Funding is either by beneficiary change or by change of title. Assets that usually require change by beneficiary include: life insurance, retirement accounts and annuities.
The assets that commonly require changes to title include: real estate and brokerage accounts.
Each asset is a little different, and while the instructions from your attorney might be clear, we often put them aside or plain forget to do the funding because there are so many other things pulling and tugging for our attention.
This is why it is essential for the attorney, financial advisor and the client to work together “after the pause” to ensure that each asset is properly directed to, or placed into trust, and that written confirmation is received from the financial company or other institution ensuring that the change was properly made.