If you’ve already created a Living Trust as part of your estate plans, your assets will be distributed according to the instructions in your trust.
But what if you forget to include property in your trust, or you didn’t have a chance to include certain things before passing away? A Pour-Over Will can help you add those missing assets.
In this post, we explore how a Living Trust and a Pour-Over Will work together and how they are valuable as part of a complete trust-based estate plan.
What is a Pour-Over Will?
A Pour-Over Will is a special type of Last Will and Testament that works together with a Living Trust.
A Pour-Over Will transfers—or pours—any missed property into your Living Trust when you pass away. Basically, having this type of Will helps you cover all your bases and prevents any applicable property from being left out of your Living Trust.
What is Estate Planning?
When you pass away, you want to make sure that your family members and children are taken care of. An estate plan is basically a series of legal documents that outline your wishes for how your property is distributed, and how your family members or children will be cared for after death.
Generally, an estate plan includes documents like a Power of Attorney, Living Will, and a Last Will and Testament, but these are just a few examples. Depending on the type of estate plan you choose, the documents you need might be slightly different.
For instance, someone with a more complicated estate like a business owner might choose to use a Living Trust as it tends to work better for passing down ownership of a business.
If you do choose a Living Trust, that doesn’t mean you can’t or shouldn’t create a Last Will, like we mentioned in our blog post about Revocable Living Trust vs. Last Will. But it does mean that you have another option for a different type of Will, and that’s the Pour-Over Will.
Should I Use a Pour-Over Will or a Last Will and Testament?
A Pour-Over Will and Last Will both set out your wishes for how any dependent family members or children will be taken care of when you pass away by allowing you to name guardians to care for them. But since the Pour-Over Will has the extra function of transferring property into your Living Trust, it might work better for you if you are already using a Living Trust in your estate plans.
What is a Living Trust?
A Living Trust allows you to determine who will receive your property when you pass away. In a Living Trust, you name a series of individuals to manage, control, and otherwise have responsibility for the trust for when you pass away.
To create a Living Trust, you must fill out a Revocable Living Trust document (revocable just means that the trust can be cancelled or amended at any time).
How does a Living Trust and Pour-Over Will Work Together?
Since a Pour-Over Will catches any property that wasn’t included in a Living Trust, it works as a back-up plan, which is great in case any property was missed or couldn’t be added to your trust before you passed away.
That extra layer of protection in your estate plans may be exactly what you are looking for to give you peace of mind that your estate is handled even in the event of an oversight or mistake.
Have you created your estate plans? Let us know in the comments!