A pour-over will is a specific type of will and testament designed to work with a trust-based estate plan. Pour-over wills can come in handy with the individual who created the trust does not transfer all of their assets into the trust and doesn’t have a will to determine who the beneficiaries should be. If you live in Pennsylvania, here are some things you should know about pour-over wills and estate planning.
How does a pour-over will work?
Instead of overseeing the distribution of your property, a pour-over will declares that any property that was not funded into your revocable living trust should be placed in the trust when you pass away. In terms of estate planning, this means your trust will serve as the beneficiary of any properties that are not already in the trust. Your assets will not automatically go to a living beneficiary through another channel such as your retirement account or life insurance policy.
Issues with probate
One of the advantages of making a living trust part of your estate planning is that your family members can avoid probate. However, if any of your assets aren’t funded into your trust before you pass away, your loved ones will have to go to probate court.
Your assets will be passed to your heirs according to the laws in the state if you don’t fund the property in your trust, have a will in place, or create a pour-over will. In an ideal situation, you won’t need to have a pour-over, but you should have one in place as a safety net in case you are not able to transfer all your assets in the trust in a timely manner.