The second important component of the Estate Plan is the Pour-Over Will. The pour-over will works hand in hand with the living trust. The pour-over will can almost be thought of as just another aspect of the trust. It is just for complicated legal reasons that these provisions must be in a "will" format.

That is sometimes confusing to clients. You may be thinking, "I'm getting a trust. Why do I need a will too?" This is perfectly understandable, but difficult to explain without a complicated legal discussion. But there are two simple aspects of the pour-over will that are important to understand.

The first thing to keep in mind is that that a pour-over will is a type of safety net. When you create a living trust, you must "fund" the trust. That means that your assets should be titled in the name of the trust. For example, property formerly titled Bob Smith is retitled Bob Smith Trustee of the Smith Family Trust. It is possible that at the time of death, a few assets were left outside of the trust. In this case, the pour-over will steps in and instructs that the assets should be distributed according to the living trust. So now either way, the assets get distributed according to your wishes.

The second important aspect of the pour-over will is that you may nominate guardians for your minor children. If you have minor children, this is a critical aspect of estate planning. Who will take care of the kids if something happens to you? If you have not nominated a guardian, the Judge will have to decide. That means that someone, a loved one, will have to step in and possibly hire a lawyer to convince the Judge that the child should go with one person or another. This is all resolved with the guardian provision of the pour-over will.

For example, let's say that little 8 year old Sally loves when Uncle Joey comes over. Sally loves Uncle Joey, and Uncle Joey loves Sally. Joey would be the perfect guardian for Sally. But if he was never nominated as guardian, he may have to go into court and fight to make that happen. The Judge may decide to hire a professional guardian. That would most likely be an attorney. That attorney must be paid and that money will come out of your estate assets. Those assets could have gone to Sally, but now they are going to the professional guardian. All this trouble could have been avoided by completing a property executed estate plan including a pour-over will.

You have to think about who will be the executors of the pour-over will. These are usually the same people as the successor trustees of your living trust. Executors and successor trustees are just the people who will take care of your estate after death. For example, a typical scenario might be a husband and wife and three grown children. The first successor trustee after the passing of the husband typically would be the wife. After the death of the wife, the oldest child would be the successor trustee, and then the second oldest and then the third.

Many clients take some time to think about who the guardians and successor trustees will be and then they usually have some questions about how this all works. Call me anytime at (925) 200-3936.