When discussing estate planning you may have heard the term “pour over Will” used at some point and wondered “What is a pour over Will and do I need one?” The simple answer to that is that if you are relying on a revocable living trust to handle the fate of your estate assets after your death you should also create a pour over Will as well.
A Last Will and Testament typically serves as the foundation of an estate plan; however, you may choose to rely on a revocable living trust to handle your estate assets instead of a Will. There are several important reasons why you might choose to use a trust instead of a Will, including, but not limited to:
- Minor Children – if you have minor children you will need to put assets intended for those children into a trust because minors cannot inherit directly.
- Privacy – your Will becomes public record during the probate of your estate. A trust agreement, on the other hand, generally remains outside of the probate process and, therefore, does not become public record. If you prefer to keep your gifts private, a trust is the only way to do that.
- Control – once a gift is given to a beneficiary in your Will you lose all ability to control what happens to that gift. A trust, however, allows you to maintain a certain degree of control over assets through the trust terms you create when you create the trust agreement.
Although a trust can accomplish the distribution of all your estate assets after your death, the reality is that some assets will remain outside of the trust at the time of your death. You may transfer your most important assets into the trust prior to your death; however, chances are good that less valuable items will still need to be accounted for after your death. Household furnishings, jewelry, clothing, collectibles, and items purchased shortly before death will likely not have been transferred into the trust at the time of your death. A pour over Will can handle these assets.
As the name implies, a pour over Will directs that all assets owned by you at the time of your death be “poured over” into the revocable living trust you created prior to your death. In essence, your pour over Will is a failsafe mechanism for anything that was not transferred into the trust prior to your death. Without a pour over Will those assets would become part of an intestate estate and would be distributed according to the Texas laws of intestate succession, a result you may not wish.
If you have additional questions about pour over Wills or wish to include one in your estate plan, consult with your Texas estate planning attorney.