I Have a Trust But Never Funded It
You Signed Everything, But Did Your Trust Actually Get Funded?
You had it drafted years ago. You signed everything, filed it away, and assumed your estate planning was handled. But recently, something made you wonder (a conversation, an article, a question from a family member) whether you ever actually transferred your assets into the trust: the house, the bank accounts, the investments.
If you didn't, the trust does nothing at death. An unfunded trust provides no probate protection in Michigan — the house and accounts you meant to keep out of probate go through it anyway.
What Does It Mean for a Trust to Be Unfunded in Michigan?
A trust is "unfunded" when the document exists but no assets have been transferred into it. Funding is the act of retitling your assets — the house, the bank accounts, the investments — out of your name and into the trust's name, and Michigan law treats it as a separate legal step from signing. Under the Estates and Protected Individuals Code (EPIC), a trust governs only the assets actually titled to it (MCL 700.1101 et seq.; trusts at MCL 700.7101 et seq.; revocable trusts at MCL 700.7602). Anything still in your name bypasses the trust and goes through probate when you die. The trust exists when it's signed. It works only when it's funded.
Does an Unfunded Trust Avoid Probate in Michigan?
No. An unfunded trust provides no probate protection in Michigan. Avoiding probate is the main reason many people set up a revocable trust. But the trust only controls assets that have been retitled into it. If your house and accounts are still in your own name when you die, they pass through probate exactly as if the trust didn't exist. The trust document alone changes nothing; only funding it does.
Common Mistakes That Leave a Michigan Trust Unfunded
Many assume funding happens automatically and don't realize funding is a separate step from creating one. Typically this is because it either wasn't explained clearly at signing or was mentioned briefly and assumed to be handled. Years pass with the assets still in the owner's name and the trust still empty.
Some hope it'll sort itself out. It won't. This is one of the most common gaps in Michigan estate planning, and one of the most consequential, because it typically isn't discovered until after someone has died, when the family is trying to figure out why the trust isn't doing what it was supposed to. By that point, the unfunded assets are already on their way to probate court.
Others try to fund it themselves with the original trust documents, but each asset type has its own funding mechanism, and getting any one wrong can defeat the goal. Without the trust attorney's involvement, mismatches are common.
How to Fund a Michigan Trust the Right Way
An unfunded trust is a document, not a plan. Funding means your assets have actually been transferred into the trust, and each asset type has its own process:
Real estate: new deed (warranty, quit claim, or Lady Bird / enhanced life estate deed depending on goals) recorded with the county Register of Deeds (Macomb or Oakland for most JBM clients)
Financial accounts: retitling at the bank or brokerage, typically requiring a certificate of trust and the trust's EIN
Retirement accounts (IRA, 401k): generally NOT funded into the trust directly, these use beneficiary designations that need to be aligned with the trust plan, not contradicted by it
Life insurance: also via beneficiary designation, aligned with the trust plan
Vehicles, boats, business interests, tangible personal property: each has its own funding mechanism (often via "Schedule A" assignment for personal property; specific Michigan procedures for business interests)
At JBM Law, we review what your trust currently holds, identify what should be transferred in, identify what should pass outside through beneficiary designations instead, and handle the coordination. We also catch the related problem: a trust funded for real estate but with retirement-account beneficiary designations that contradict the trust plan. Coordinating those is part of the work.
A complete plan also includes the supporting documents that make funding actually work: a pour-over will as a safety net for assets you forgot to transfer, and a clear designation of your successor trustee, the person who will administer the trust if you can't.
The result is a trust that actually does what you built it to do.
Funding Can Still Be Fixed — But Only While You're Here to Do It
An unfunded trust can be funded at any time while you're alive and competent. The catch is that the window closes exactly when the trust is needed: once you've died or lost capacity, no one can retitle assets into the trust for you, and whatever is still in your name goes to probate. Fixing it now is a straightforward process. Fixing it later isn't possible.
Find Out Whether Your Trust Is Actually Funded
Schedule a free consultation. You'll know the cost of any work before you decide.
Need to learn more about estate planning first? Start with our estate planning guide, or go straight to our Living Trust Attorney page for trust-specific detail.