Signing a revocable living trust is only half the job. In Palm Beach, the most common and most costly trust mistake is leaving it unfunded. “Funding” means retitling your assets into the trust’s name so they are governed by it. An unfunded trust does nothing to avoid Florida probate, no matter how well it was drafted. Here is how to fund a trust correctly, step by step, with the timeline and costs involved.
Why Funding Is the Whole Point
A revocable trust under Florida’s Chapter 736 avoids probate only for the assets it actually holds. Anything still titled in your individual name at death may pass through Florida administration anyway, either summary administration under Chapter 735 or formal administration under Chapter 733. Funding is what converts your trust from a document into a working plan.
Step 1: Real Estate
For a Palm Beach home or other real property, you record a new deed transferring the property into the trust. Florida homestead (Article X, Section 4) deserves special care here, because the trust must be structured so it does not disturb your homestead tax exemption or creditor protection. Some owners instead use a Lady Bird, or enhanced life estate, deed, which passes the property to a named beneficiary at death outside probate while you keep full control and the right to sell during life. Each approach has trade-offs and must be drafted and recorded correctly in Palm Beach County.
Step 2: Bank and Brokerage Accounts
Retitle non-retirement accounts into the trust’s name, or in some cases use payable-on-death and transfer-on-death designations that coordinate with your plan. Bring your trust’s certificate of trust to the institution; Florida law (§736.1017) lets you provide this short summary instead of the entire trust document.
Step 3: Retirement Accounts and Life Insurance
Be careful here. You generally do not retitle an IRA or 401(k) into a trust, because that can trigger income tax. Instead, you update the beneficiary designation, sometimes naming the trust as beneficiary, sometimes individuals, depending on your goals. Life insurance is handled through beneficiary forms as well. This step is where coordination with an attorney matters most.
Step 4: Business Interests and Personal Property
Membership interests in an LLC or shares in a closely held company can be assigned to the trust, subject to any operating agreement. Tangible personal property is usually transferred through a general assignment document signed alongside the trust.
Timeline and Cost
Drafting the trust takes a few weeks; funding can take several more, because deeds must be recorded and institutions process retitling at their own pace. Many Palm Beach attorneys include deed preparation and a funding checklist in a flat fee, but confirm this before signing. Since Florida has no state estate or inheritance tax, funding is about avoiding probate and preserving privacy, not tax savings.
Consult a Florida Attorney
Funding errors, especially with homestead and retirement accounts, can quietly undo an otherwise solid trust. A licensed Florida estate planning attorney serving Palm Beach can prepare the deeds and a funding plan tailored to your assets. This article is general information, not legal advice.
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