Signing a living trust may feel like the final step in protecting your family. However, the trust generally does not control a home, account or business interest that you never transfer or otherwise connect to it. That property may still require probate or another transfer process after your death.
In California, this process is called funding, which means transferring assets to your trust or coordinating them with another transfer method.
Which assets may require separate transfer steps?
The process depends on the property and institution involved. Common examples include:
- Real estate: A home or rental property may require a new deed recorded with the county.
- Financial accounts: A bank or investment company may request trust documents and new ownership forms.
- Business interests: A transfer may require an assignment and compliance with the company’s governing documents.
Not every asset belongs in a trust. Retirement accounts and life insurance policies, for example, generally pass through beneficiary designations. Reviewing how each asset transfers can help you identify gaps or conflicting instructions.
What happens when property stays outside the trust?
Property left in your name may require probate or another court procedure after your death. A pour-over will may direct that property into the trust, but it does not, by itself, keep the property out of probate.
A trustee or another interested person may file a petition under Section 850 of the California Probate Code. When the request asks the court to confirm that property belongs to a trust, it is often called a Heggstad petition. The outcome depends on the trust documents and other evidence of the owner’s intent.
Keep your trust aligned with what you own
Your trust works most effectively when its documents and your asset records support the same plan. Reviewing them after a purchase, refinance or account change may uncover gaps before your family must address them through a court process. Keeping these records consistent may reduce delays, added costs and uncertainty for your family.