A unique kind of last will and testament called a "pour-over will" is used in conjunction with an estate plan based on trusts. It can come in handy when a trust's grantor—the person who established the trust—forgets to transfer all of their assets into the trust over time and lacks a will to specify which beneficiaries should get the omitted assets.
A Pour-Over Will Operation
A pour-over will specify that any assets that have not been funded into your revocable living trust should go there after you pass away rather than control the distribution of all of your assets. It effectively names your trust as the beneficiary of any property that it does not already own.No other method, such as a beneficiary designation on a life insurance policy or retirement account, transfers that property directly to a living beneficiary.Probate Concerns
One benefit of having a living trust is that the assets used to fund it are not subject to probate. Regrettably, probate will be necessary for any of your assets that weren't funded into your trust before your death. If you fail to finance your trust, don't make a pour-over will, or don't have any other will in place dictating where those assets should go, your property will transfer to your heirs in accordance with state law. These are referred to as "intestate succession laws," and they can differ slightly between states. In the absence of an estate plan, each state maintains a list of relatives who are so closely connected to a decedent that they automatically inherit from them. Your parents, surviving spouses, and any children, grandchildren, or great-grandchildren are always on the list. More distant relatives and siblings are frequently forgotten about. According to this state-by-state rule, your intentions may not be carried out if you don't have a pour-over will or other legal documents that designate a particular recipient for your property. Let's say you failed to include your new vacation house in your trust's funding. If you are not married, your son may inherit the home due to your shared ancestry, even though you have not spoken to him in years.You should use your pour-over will as a safety net
Your pour-over will ideally not be necessary. In the worst-case situation, you'll be aware that it exists, but it won't be necessary because your living trust will have already received all of your assets when you pass away. Make it a point to review your trust agreements once a year at the very least. Verify that you haven't bought any new property in the past year that has to be paid into the trust. You can include this clause in your trust agreement if you want a specific beneficiary to receive that new asset in the event of your passing. As long as you are mentally competent, revocable living trusts can be amended at any time during your lifetime.