My brother recently passed away. He had a trust but didn’t put all of his accounts in it. He has one large account that I cannot access. The bank says I need to go to probate court. It has a $400,000.00 balance, and it is frozen. Argh!
– Frustrated & Frozen on Franklin
Dear Frustrated & Frozen on Franklin:
Indeed, it is frustrating when a trust has been created (to make things easier), but the bank freezes the funds because the account was not set up correctly beforehand with the bank by the owner.
The importance of “funding” your Trust (registering the account in trust at the bank) or naming a living beneficiary cannot be understated. If the accounts are not set up properly, your agent cannot get up “at bat” without a lot of hassle, which often includes going to court.
When the time comes, you want your financial agent to receive the “red carpet” treatment, not the oh-so-familiar “red tape” that we all experience. The way you can help your successor Agent NOW is to review each and every account. Is the account in Trust? Does it have a joint owner? Does it have a living beneficiary named to get it? Generally speaking, each account should have one of these for a smooth administration.
I always like to administer estates where we have a “clean sweep” collecting funds. Striking out is expensive and annoying. Play ball!
In this video I talk about “What Does It Mean To “Fund” A Trust?“.