Do you want to create a living trust? This legal and estate planning tool, often available online, protects assets and simplifies their transition to your intended heirs. But what should you transfer into your trust? To help you decide, here are a few dos and don'ts for transferring assets into a trust. 

Do Transfer Real Estate

Real estate is one of the largest assets in most Americans' possessions. It's also one of the easiest assets to place into a trust. Even if you co-own a home with someone else (usually a spouse), you can generally easily transfer your portion of the interest into a trust. Transferring real estate gives what is likely the largest chunk of your estate the most protection. 

Don't Transfer What You'll Sell

Transferring items to your trust is long-term planning, so you should focus on what will be around long-term. If you buy and sell stock on a regular basis, for example, moving it into and out of a trust may be burdensome and inefficient. On the other hand, your art collection may change on a much less frequent basis. The former might be best handled with beneficiaries, while the latter could be incorporated into the trust. 

Do Check On Business Interests First

A second large component of some estates is business interest. How these are transferred — and indeed, whether or not they can be transferred — depends on the specifics of the business. If you're a sole proprietor, for instance, you would transfer the physical assets into your trust. However, a partnership agreement may prohibit the transfer of interests to a trust. Learn more about your particular business options first. 

Don't Overlook the Use of Beneficiaries

Not all assets need to go into your trust to be kept private and transfer easily after your death. Accounts with joint ownership or "payable on death" beneficiaries will often transfer automatically and outside of probate. If it's easier to leave these outside the trust, you can focus more on the important items (like your primary home) that can't be easily protected in other ways. 

Do Update Your Trust Regularly

Once you create a trust and move key assets into it, don't forget to regularly check the need for updates. You may have acquired new assets, like antique vehicles, that need to be placed in the trust. On the other hand, some assets may have been sold or have depreciated enough so as to make the trust protection unnecessary. Check in on your trust and personal assets once per year. 

Learn more about how to set up a trust and maintain its assets in the most simple and direct way by visiting a financial planning service that specializes in living trusts. By learning what you need to know about assets and trusts, you can protect yourself while avoiding unnecessary challenges. 

To learn more, contact a resource that offers online living trust services.

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