If I Have a Trust, Do I Still Need a Will?
Distributing your estate assets can be accomplished using a Last Will and Testament or a trust agreement. Because of the additional benefits a trust offers, many people choose to rely on a trust as the primary vehicle for distributing their estate assets. That does not mean, however, that a Will is no longer necessary. The Coral Gables trust attorneys at Stivers Law discuss why you should have a pour-over Will even if you are relying on a trust as your primary distribution vehicle within your estate plan.
What Can a Basic Last Will and Testament Do?
A Last Will and Testament is a legally binding testament, usually in writing, that allows you to make both general and/or specific gifts of assets from your estate to designated beneficiaries. Those gifts are legally required to be honored after your death. Your Will also allows you to appoint someone to be the Executor of your estate and nominate a Guardian for your minor children. A Will works fine to distribute a relatively simple and modest estate; however, if you have minor children, complex assets, and/or distinctive estate planning goals, you should consider incorporating a trust into your estate plan as the primary vehicle by which your assets will be distributed after your death.
What Can a Trust Do?
A trust is a relationship whereby property is held by one party for the benefit of another. A trust is created by a Settlor (also referred to as a Maker or Grantor), who transfers property to a Trustee. The Trustee holds that property for the trust’s beneficiaries. All trusts are first divided into one of two categories – testamentary or inter vivos – the latter of which is more commonly referred to as a living trust. A testamentary trust is a trust that arises upon the death of the Settlor and is typically activated by a provision in the Settlor’s Will. A living trust is a trust that takes effect as soon as all the legalities of creation are in place.
What Is a Pour-Over Will?
Although a trust can take the place of a Last Will and Testament regarding the distribution of estate assets, your estate may have some loose ends after your death that can only be taken care of if you have a Will in place. For this reason, a “Pour Over Will” is usually included in an estate plan when a trust is used as the primary distribution tool. While you may manage to transfer all your most valuable assets into a trust prior to your death, you will almost inevitably leave behind some assets that fail to make it into the trust. Personal items, vehicles, less valuable assets, bank accounts used for day-to-day banking, and even valuable assets purchased just prior to your death are all examples of assets that might be inadvertently left out of the trust at the time of your death. If they remain unaccounted for, they will create an intestate estate that requires probate. A Pour Over Will directs all assets not already transferred into the trust to be “poured over” into the trust after your death, preventing the need for an intestate administration for those left-over assets.
Contact Our Coral Gables Trust Attorneys
For more information, please join us for an upcoming FREE webinar. If you have additional questions or concerns about creating a pour-over Will to accompany your trust agreement, contact the experienced Coral Gables trust attorneys at Stivers Law by calling (305) 456-3255 to schedule an appointment.