Have A Revocable Living Trust? You Need A Pour Over Will

The whole point of establishing a Revocable Living Trust is to avoid probate. So, why would you need a will to go along with your trust? To make sure all of your property makes its way to your intended beneficiaries.

Assets Can Be Left Out of a Trust

Despite the best of intentions, assets can be left out of a Revocable Living Trust. Sometimes this is done on purpose, and sometimes its inadvertent people acquire new property and pass away before it can be transferred into their trust, or they simply forget.

One of the primary ways that property is inadvertently omitted from a trust is through the refinance process. Youve funded your home into your trust and, when you want to refinance, your lender requires you to put the title back in your individual name, just for the refinance transaction. The problem is that its easy to forget to deed the property back into your trust once the refinance is finished. If this happens and you pass away, the house could be subject to probate.

If assets arent in your trust, and theyre subject to probate, then one of two things will happen when you pass away:

Without a Will

If you have a Revocable Living Trust, but no will, then any property thats subject to probate will pass to your heirs at law. These are the people who are entitled to inherit from you, as defined by state intestacy laws. They may or may not be the same people youve selected as beneficiaries under the terms of your trust. So, theres the potential for part of your estate to go to people you never intended to inherit your property.

With a Will

A pour-over will is one thats designed to catch any property thats not owned by your trust at the time of your death, and is therefore subject to probate, and pour that property into your trust. If you have a pour-over will, the result of the probate process is that this left-out property will be transferred to your trustee, who will then distribute it to the beneficiaries of your trust, as originally intended.
So, a pour-over will works with your trust to make sure that, after all is said and done, your estate is distributed in the way you intended.