How to Transfer a Vanguard Account to a Living Trust

By Stephanie Kurose, J.D.

How to Transfer a Vanguard Account to a Living Trust

By Stephanie Kurose, J.D.

Vanguard is a popular investment firm that manages different types of investment accounts. An investment account often names a beneficiary to receive the contents of the account upon the original investor's death. In some cases, a legal document known as a living trust is used to allow a person to pass assets to beneficiaries after death without going through probate.

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Transferring a Vanguard account to a living trust is just another way to ensure the intended beneficiaries receive the funds. It is also easier to change the named beneficiaries when the trust is the account owner.

To transfer a Vanguard account into a living trust, there are a few simple steps to follow.

1. Add the Vanguard account to the trust's schedule of assets.

A schedule of assets lists all of the assets held in that trust and typically appears on the last page of the trust document. Be sure to clearly identify the account by indicating the type of account and the account number.

2. Use the full name of the living trust.

Take note of the full name of the living trust into which you want to transfer the Vanguard account. The name should be on the trust document itself, usually on the first page. If the full name includes the execution date, you must include that as well.

3. Contact Vanguard.

Inform your Vanguard account representative that you would like to transfer the account to the trust. The account representative will need the full name of the trust, as mentioned in the previous step, and will likely need a certificate of trust to verify the information, as well as a completed change of ownership form. Both forms are available on Vanguard's website.

4. Obtain a signature guarantee.

A signature guarantee, issued by a bank or other financial institution, is a way to verify the authenticity of the signature and the signatory's overall request. The signature guarantee must show a date within 30 days of the date of title transfer. Note that a signature guarantee is not the same as getting a document notarized.

If the beneficiary of the Vanguard account and the beneficiary of the trust are different people, transferring a Vanguard account into a trust does not negate the original account beneficiary. The investment account will still pass to the named beneficiary outside of the trust. However, it might cause confusion among the beneficiaries when it comes time to distribute the trust's assets if the beneficiary of the Vanguard account is different than the beneficiary of the trust. The trustee, or manager of the trust, must ensure that the right assets pass to the right beneficiaries.

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