Most people think of the traditional will when they imagine creating an estate plan. However, you have many other options when it comes to estate planning. Wills and trusts are two of the most common types of estate planning instruments, but many people don’t realize that you can effectively combine the two using something called a pour-over will.
What exactly is a Texas pour-over will? And is it the right option for your situation? Here’s a closer look at what a pour-over will is and what it can do.
What Is a Pour-Over Will?
Many people incorporate a living trust document into their estate plans. These trusts spare you from having to list out beneficiary designations in a will. Instead, your personal representative or trustee can distribute your assets according to the guidelines you’ve set for the trust.
However, it can be difficult to keep up with officially transferring new personal assets to your trust. If you die unexpectedly, it’s very possible that there will be some unallocated assets.
That’s where a pour-over will come in. This kind of will is a “safety net,” meaning it ensures these unallocated assets are placed into the trust. Here’s a quick rundown of how the process works:
- You create a revocable living trust
- You transfer existing assets into the trust
- You create a pour-over will that lists the trust as the beneficiary of assets not already in the trust
- Upon your death, these leftover assets are transferred to the trust
- The administrator of the trust distributes assets to the beneficiaries you’ve chosen
A pour-over will is not a requirement for having a living trust. However, because these wills are quick, easy, and inexpensive to create — and they can greatly simplify asset distribution after your death — many people elect to create one.
How Pour-Over Wills Work With Living Trusts
Usually, people who create pour-over will use them with revocable trusts (or “living trusts”). The main advantage of a revocable trust is that it keeps the assets in the trust from having to go through probate.
Probate is a public, court-supervised process where the court validates a will and distributes the assets listed within it. It’s also an expensive and time-consuming process and can cause your loved ones considerable stress when they’re already grieving.
Upon your death, any assets you haven’t already placed in the trust will be automatically transferred from your pour-over will to the trust.
However, it’s important to understand that while assets already in a trust can avoid probate, a pour-over will must be probated before assets can be transferred. For that reason, you should transfer as much as you can to your living trust during your lifetime — the pour-over will just be there to catch what you didn’t transfer before death.
Benefits and Drawbacks of Pour-Over Wills
Before deciding whether this option is right for you, make sure you weigh the pros and cons of pour-over wills. Here are some of the advantages:
- You don’t have to list individual beneficiaries in your will
- You can ensure all your assets will be distributed as you wish
- A pour-over will make it easier for your executor to close out your estate
- It prevents the details of who receives what from becoming public record
However, these wills also have downsides, which include:
- Assets in the will must still go through probate
- Assets in the will (or the revocable trust) are not protected from creditors
- Assets in the will and trust aren’t shielded from litigation
When making your decision, you should compare pour-over wills to other options and decide which is best. An estate planning attorney can help with this.
Creating a Pour-Over Will in Texas
The process of creating a pour-over will is relatively straightforward:
- First, create a living trust
- Next, create a pour-over will
- List the trust as the beneficiary in your will
- Name an executor for the will
This process may be simpler than for many other kinds of estate planning tools, but it’s still essential to work with an attorney. Your attorney will be able to make sure the will is compliant with all applicable laws and that it will be enforceable in court.
Pour-Over Wills and Estate Planning
A complete estate plan includes every possible tool to simplify the process of distribution of your assets. In many cases, that means adding a pour-over will to an existing living trust.
However, while this solution may be the right estate plan for some, that doesn’t mean it’s necessarily right for you. The best way to craft the right estate plan for you is to work with an experienced estate planning attorney.
The Role of an Estate Planning Attorney
The point of a pour-over will is to avoid probate and simply the process of distributing your assets after your death.
However, if you want to make sure your assets will be distributed according to your wishes upon your death, it is vital to work with an experienced estate planning attorney. If you create a pour-over will and that will is not properly created or filed, it will not be legally enforceable.
Your attorney can help you ensure your will meets all legal requirements, but that isn’t all. A pour-over will is just one example of an estate planning tool, and it might not be right for everyone. Your attorney can gain a solid understanding of your situation and help you determine whether a pour-over will or another option is best for your needs.
Why You Need Hunter Sargent, Denton Estate Planning Attorney, for Your Pour-Over Will
You need an estate planning attorney to help you ensure your pour-over will is legally valid. The best way to make sure that will is honored by the court is to choose a law firm with considerable experience — and a track record of excellence — in estate planning.
At Hunter Sargent, we have been securing Texas legacies for seven generations and counting. We understand that every person’s situation is unique, and that calls for a customized estate plan to meet your needs and those of your beneficiaries.
Additionally, because we use a flat fee structure, you can be assured that you’ll never run into any surprise costs when working with us.
If you need to create or update a pour-over will or need general guidance when it comes to the estate planning process, we’re here for you. Get in touch to schedule a meeting today.
Frequently Asked Questions
What Is a Pour-Over Will in Texas?
If you’re considering pour-over wills, Texas offers you this option to simplify the estate planning process. A pour-over will is typically used with a living trust, and after your death, the will ensures any assets you haven’t already transferred will be moved to that trust.
Does a Pour-Over Will Have to Go Through Probate?
Yes. With a pour-over will, probate is necessary for any assets that have not already been transferred to the living trust. It’s best to transfer as much as you can to your revocable living trust before your death, and your pour-over will catch any assets you did not manage to transfer during your lifetime.
What’s the Main Advantage of a Pour-Over Will?
Unlike in a traditional will, you don’t have to specify which beneficiaries receive which assets in a pour-over will. You can simply transfer the assets to your living trust and allow your executor to distribute all the assets.
Do I Have to Have a Pour-Over Will if I Already Have a Trust?
Technically, you do not. However, it’s entirely possible to forget to transfer all your assets to the trust before your death. When you have a pour-over will, you have an inexpensive yet effective “safety net” to ensure your entire estate makes it into the trust as you intended.