Creating a trust is one of the smartest moves you can make during estate planning. It helps your family avoid probate, keeps your affairs private, and ensures your assets are handled exactly how you want. But many people have a trust that is, for all practical purposes, useless.

At Best Coast Estate Law, P.C., we’ve seen this happen over and over again with California families. Someone takes the time (and spends the money) to create a trust, only to find out—too late—that it doesn’t actually do what it’s supposed to.

How to Fund a Trust

The most common reason a trust ends up being useless is simple: the trust was never properly funded.

Funding a trust means transferring ownership of your assets into the name of the trust. If that doesn’t happen, your trust is essentially an empty box—it may look nice, but it holds nothing. And if it holds nothing, it does nothing.

Let’s say you’re creating a living trust but leave all your assets – your house, bank accounts, or investment accounts – in your personal name. When you pass away, those trust assets still have to go through probate, defeating the whole purpose of the trust.

A Common Pitfall of Asset Distribution

Imagine a couple in California creates a revocable living trust. They want to avoid probate and make things simple for their kids and their family’s future. They sign the documents, account for current personal property and stick the binder on a shelf. But they never transfer title of their home into the trust. Years later, one of them passes away, and suddenly the family is dealing with probate court—because the house wasn’t in the trust.

This isn’t just hypothetical. It’s a common mistake that happens all the time, and it’s one of the most avoidable estate planning mistakes out there.

Other Common Living Trust Mistakes in California and How to Avoid Them

While funding a trust is the #1 issue, there are other ways a trust can fall short:

1. Outdated or Incomplete Documents

Laws change, your life changes, and major life events happen unexpectedly. If your trust was written 10 or 20 years ago and never reviewed, it might not reflect your current wishes—or comply with current California law. It also may not account for new beneficiaries (like grandchildren), updated tax rules, or property you’ve acquired since then.

2. No Pour-Over Will

Even if you forget to fund one or two small assets into the trust, a properly drafted pour-over will can help. It acts as a backup, “pouring” those assets into the trust after you pass. But if you don’t have one—or it’s not legally valid—you don’t transfer assets and they may still end up in probate.

3. No Successor Trustee or Bad Trustee Choices

What is estate administration? Your trust needs someone responsible to manage it when you’re gone. If you never named a reliable successor trustee—or chose someone unreliable—it can create confusion, conflict, or even legal authority intervention. A trust is only as effective as the person in charge of carrying out its terms to prevent legal challenges. They should have a deep understanding, or know who to talk to, in terms of estate taxes, tax implications, what your valuable assets are, and give careful consideration to your wishes.

4. Assets With Beneficiary Designations

Some assets like retirement accounts, life insurance policies, or bank accounts with “payable on death” designations—pass outside of the trust. If the beneficiaries listed are outdated (like an ex-spouse) or inconsistent with your trust, it can completely undermine your estate plan.

How to Fix Your Trust Documents

Here’s how you can make sure your trust actually works the way it’s supposed to:

1. Trust Creation & Proper Funding

Asset protection is key. Start by making sure your major assets and personal property are titled in the name of your trust. That includes:

  • Your primary residence and any rental properties
  • Bank accounts
  • Investment and brokerage accounts
  • Business interests

This usually involves changing the title or ownership to something like “John and Jane Smith, Trustees of the Smith Family Trust dated January 1, 2020.” And don’t forget to update your homeowner’s insurance if your property is now owned by a trust.

2. Review Your Plan Regularly

We recommend reviewing your trust every 3 to 5 years—or sooner if you’ve had a major life change like marriage, divorce, a new baby, or buying property. Make sure the beneficiaries, trustees, and instructions in the legal document still reflect your goals.

3. Update Beneficiary Designations

Double-check any accounts or policies with designated beneficiaries. Make sure they coordinate with your overall estate plan. In some cases, your trust might need to be named as the beneficiary.

4. Seek Professional Guidance For Estate Planning Help

Estate planning is not a one-size-fits-all project and you should work with an estate planning attorney. At Best Coast Estate Law, P.C., we specialize in reviewing, updating, and funding trusts for California families. We can help you catch what’s missing, bring your documents up to date, and give you peace of mind knowing everything is in place.

Final Thoughts

If you’ve made the effort to create a trust, that’s a great first step—but it’s not the finish line. The most common estate planning mistake we see is people assuming the trust will take care of everything automatically. It won’t. It needs to be funded, maintained, and reviewed.

Don’t let your estate plan sit on a shelf and collect dust. Let’s make sure it works the way you intended.

If you’re not sure whether your trust is doing its job, we’re here to help. Contact Best Coast Estate Law, P.C. for a trust review, free consultation, and a conversation about how to make your plan truly effective for you and your family.