- Today, we're going to discuss pour-over wills.
Welcome to 2 Minute Tuesday,
where I attempt to discuss an estate planning topic
in two minutes or less.
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The other day, I got a call from somebody
asking why their relatives had a pour-over will
and not a last will and testament.
Well, without knowing anything about their relatives,
I attempted to answer their question.
And at the same time, I thought this would be a great topic
for 2 Minute Tuesday.
So why do some people have a last will and testament,
and some people have a pour-over will?
Somebody usually has a pour-over will
when they have a revocable living trust.
The pour-over will acts as a kind of a catch-all,
so if you have a revocable living trust,
one of the main reasons is probably to avoid probate.
No one wants to put their families
through the long and sometimes emotional process of probate
and having to go down to the courthouse.
However, in order for a revocable living trust
to work properly, and avoid probate,
all of your assets must be titled in the name of the trust.
So, a pour-over will acts as kind of a catch-all
in the event you forget to place an asset
in the name of the trust.
An example that I always give
is let's say you go out and you buy a brand new car.
The dealer tells you he'll tag it for you.
And you think, well, that's a great idea.
And you make sure to tell the dealer
to tag it in the name of your trust.
Well, the dealer sends somebody out there to title the car,
and it gets titled in your name
and not in the name of the revocable living trust.
Then you pass away before you discover
the car is titled incorrectly.
Well, in that scenario,
we would use the pour-over will
to pour the asset, or the car in this case,
back into the trust,
for distribution according to the terms of the trust.
The car will still need to be probated
but at least you have the peace of mind
knowing it'll be distributed
according to the terms of your trust.
And it does not have to be just a car,
we've had some people sell the home
that we put into trust for them
and then they go out and buy a brand new house,
and they forget to title the new house
in the name of their revocable living trust.
In that case, we have to probate the house.
So our goal is for all of our trust clients
never to need probate.
But just in case,
we have the pour-over will as a safety net.
Well, that's all for today.
Not sure if I made it under the two minutes.
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