Most people use a standard will as the central pillar of their estate plan. They use it to detail what should happen to the assets they own when they die.
Yet some people prefer to base their estate plan on a revocable living trust, instead. The main reason people do this is to avoid their assets passing through probate, which will probably happen with a will. Probate can slow the distribution of assets down. It also provides a chance for creditors to claim part of the estate.
Revocable living trusts can only cover the assets they hold
When making a revocable living trust, you will need to fund it with the assets you want it to govern. You transfer ownership of each asset from yourself to the trust. That is fine for the assets you hold at the time you create the trust but it does not provide for any future assets you acquire. This is where a pour-over will can help.
Sweeping up anything not already passed to the trust
When you die the pour-over will goes into action. It takes any assets that are still in your name and gives the trust ownership of them. That means the trust can then handle your full estate, except for anything covered by a different trust or with a beneficiary designation.
The beauty of pour-over wills is that they provide you with a safety net. You no longer have to worry about forgetting to move a new asset you acquire into the trust, as the pour-over will take care of that when you pass. That does not mean you shouldn’t regularly update your estate plan and fund the trust with new assets. You still should. It just provides a backup for any you forget or do not get around to transferring.
Learning more about this and other estate planning options can help you create an appropriate plan for you and your family.