Many people establishing an estate plan use one particular testamentary instrument. They may choose to draft a will or to establish a trust. Factors including the age of beneficiaries and the value of personal assets can influence which testamentary instrument a testator chooses to use.
In some cases, it might actually be beneficial for a testator to create both a will and a trust. People may want to use a trust to manage the inheritance they want to leave for specific, high-risk beneficiaries while bequeathing property to others using a will. They might use a trust as a way of protecting specific assets while using a will to address other estate planning concerns. It is also potentially possible to use a will to help fund a trust and prevent issues from arising with personal property not specifically discussed elsewhere in the estate plan.
What a pour-over will does
Standard wills allow people to designate beneficiaries to inherit specific assets. People can even name one person to inherit the remainder of their estate not addressed in detail elsewhere in the estate plan. Sometimes, people make arrangements to transfer particularly valuable resources to a trust and may address other, lower-value assets in a will.
There may be certain resources that they do not mention explicitly in their estate planning paperwork, possibly because they do not want to transfer those assets to the trust yet. A pour-over will helps address those assets. Essentially, a pour-over will provides instructions for the transfer of any assets not designated for specific beneficiaries or already transferred to the trust to pour over into the trust as part of the probate process.
A pour-over will give the trustee control over the management and distribution of any assets not already addressed within an estate plan. While a pour-over will is likely not the only source of funding for a trust, it can be a crucial inclusion in estate plans that primarily rely on trusts.
The extent of an individual’s property and the beneficiaries who may inherit from their estate directly influence which documents might be the proper choice for their estate plan. Combining a will and a trust can be an effective strategy for those who don’t want to preemptively transfer the ownership of various assets to a trust while they are still alive but want a trustee to oversee the distribution and management of those assets.