A Pour Over Will is used in Estate Planning to ensure every asset in your estate is protected after you pass away. It’s used in conjunction with a Living Trust, and it allows all of your assets to transfer into the Trust after your death. A Pour Over Will can be a saving grace if you forgot to (or are unable to, or choose not to) move assets into your Trust while you’re still alive.
If everything you own is already in a Trust, a Pour Over Will may not be necessary. However, it can be a great safeguard and tool that you may want to consider. Learn all you need to know about this type of Will, including:
What is a Pour Over Will in a Living Trust?
A Pour Over Will is just a type of Will you create that will allow for assets to automatically transfer to a previously set-up Living Trust. It’s useful for those smaller assets that you may have forgotten, or for those you chose to not put into your Trust for any number of reasons. A Pour Over Will definition may be easier to understand if you can look at an example.
Pour Over Will Example
A Pour Over Will scenario could look something like this:
Rob has a Living Trust that holds almost all of his assets and property. To fully protect himself, his wife and his children, he decides to create a Pour Over Will that explicitly states “any assets or property that are not in my Trust at the time of my death, that are not clearly left to a beneficiary of my Will, should immediately go into my Living Trust.” Once Rob passes away, all property in his Will goes through probate, and then “pours over” to the Trust, where it can be distributed to the Trust’s beneficiary (or beneficiaries).
In this Pour Over Will sample, the process was a bit longer than it could have been if Rob simply held everything in his Trust to begin with, or if he just let the assets in the Will go through probate and then be distributed directly to beneficiaries from there (the latter would have allowed the Trust to be distributed faster, rather than having to wait for the Will assets to go through probate first).
What is the Difference between a Will and a Pour Over Will?
Why would you use a Pour Over Will vs just a Will? For starters, it acts as a safeguard to catch any assets that you’d want to eventually be in your Trust.
The Pour Over Will can mean the end result is simple, complete and private (in that the Trust will be the final holding place for all property and assets). Trusts can offer tax advantages, privacy and many other benefits that Estate Planning experts see as valuable and worthwhile. If you just have a simple Will (rather than a Pour Over Will), any assets in there would not be able to reap the benefits that Living Trust assets do.
Does a Pour Over Will Avoid Probate?
Unfortunately, no, a Pour Over Will does not avoid probate. Because assets in a Pour Over Will are not yet owned by the Trust, they must go through probate before they can be transferred over, and it’s only then that they can realize any benefits a Trust has to offer.
Still, even though probate is inherently public (unlike a Trust, which offers privacy), there is still a degree of privacy a Pour Over Will can offer. The Will, and any assets to be transferred, are both public record, but beyond that, the privacy kicks in as soon as assets are moved into the Trust.
Once the assets are finally in the Trust, a level of confidentiality is established and what happens from that point on remains private. This includes both asset descriptions and values, as well as beneficiaries and distributions.
How to Create a Living Trust with Pour Over Will - Using a Pour-Over Will in Estate Planning?
Creating a Pour Over Will as part of your Estate Plan is actually really simple. Thinking of it as a safety net can help you understand how it functions. Before you can create your Pour Over Will, you need to have a Living Trust established.
To create a Trust, you’ll need to select a Trustee. Once you’ve funded the Trust (by transferring assets into it), you’ll name beneficiaries and detail how you want the Trust managed once the Trustee steps in.
After your Living Trust is established and funded, you can create your Pour Over Will. Your beneficiary for the Will would be the Trust, rather than individual people. This means that anything inside the Will now is set up to transfer to the Trust upon your passing. You should include language in your Pour Over Will that clearly states: any assets or property that are not in the Trust at the time of death, and that do not have a named beneficiary, should be transferred to the Trust after you pass.
It’s important to make sure your Pour Over Will is properly signed and witnessed so it’s legal. In regards to witnesses, you should check how many are required in your state.
When you create a Will through a trusted company like Trust & Will, you’ll automatically get a Pour Over Will as part of our comprehensive Estate Planning process. This way, you’re already set up to take advantage of the benefits of having a Trust, and you’ll have a Will in place that makes sure nothing is forgotten.
There’s no such thing as being too prepared when it comes to your Estate Plan. The more time and effort you put into planning for your future, the more protection you’ll have. Set up your Pour Over Will today with Trust & Will. You’ll rest easy knowing that you’ve thought of, and prepared for, anything life throws at you.