Estate planning can be complicated. One of the biggest reasons it can be so difficult is that there is so much at stake: your legacy, your assets, and the well-being of your heirs. Another reason is that the terminology is often very confusing. If you are not an estate planning attorney, you likely do not know what many words and concepts associated with estate planning mean. One common example of this is something called a “pour-over” will. This is an incredibly common and important estate planning tool, but one most people do not know anything about. Read on to learn more about whether a pour-over will could be right for you.
What is a Pour-Over Will?
You likely know that a will is a legal instrument you use to specify who gets what pieces of your estate after you pass away. A pour-over will is a kind of will that ensures that any assets you have which are not explicitly accounted for in your will are placed into a trust at the time of your death. Think of it as one final protective sweep of your assets.
How Do Pour-Over Wills Work?
Pour-over wills work in tandem with an established trust. A trust is an instrument which allows you to transfer certain assets to your designated beneficiaries in a way that protects them from certain types of taxes, and also allows you to more directly control they manner in which those assets are used. Unlike most wills, which specify who is to receive which asset, a pour-over will essentially says that any assets you have at the time of your death which were not already placed into your trust or specifically designated for another person in your will are placed into your trust after you die. With a pour-over will, your trust serves as the beneficiary of property that you have not already allocated to someone else.
Why Should You Create a Pour-Over Will?
If you have created a trust, or are thinking of creating a trust, to distribute your assets for your beneficiaries, a pour-over will is likely something you will need. We acquire assets throughout the duration of our lives, and once people finish a will they often do not think to update it to account for acquisitions of assets like cars, new bank accounts, and other assets that seem relatively common. You may intend for all or most of your assets to be placed into a trust after you pass, but if you do not have a legal structure that ensures this will happen you are setting your estate and your beneficiaries up for costly and extensive legal proceedings.
Questions About Creating a Pour-Over Will?
At Unique Estate Law, we know that estate planning can be complicated and that the terminology involved is confusing. No matter if you currently have a trust or are thinking of creating one to care for your beneficiaries after you pass, a pour-over will is a powerful tool that can ensure the success of your trust. At Unique Estate Law, Chris Tymchuck has extensive experience helping clients not only create trusts but also create pour-over wills that integrate seamlessly into their trusts. Contact Unique Estate Law today to learn more.