Though wills may be the best known estate planning device, in California today, they are only used in place of a trust, when the estate is small enough to avoid probate administration by means of the various small estate procedures available. A pour over will is a type of will that is created when a revocable trust (living trust) is created, so any assets not transferred to the trust before death will automatically be transferred to the trust upon death.
Trusts are now the more popular and efficient way to distribute assets to beneficiaries upon your death. A trust is the best way to make sure there is a trouble free transfer of assets outside of the probate process. A Trust Fund is the legal entity those assets are placed or “deposited” into when the Trust is created.
Though there are different types of trusts that serve different functions, the most common one is the Revocable Trust (also known as a Living Trust). Like a will, a Revocable Trust allows you to name beneficiaries and decide how your accumulated estate will be distributed. You identify your assets and property and decide who gets what upon your death.
It has the added flexibility of allowing you to make changes while you are living and of sound mind. Also you can access and use your assets as you need during your lifetime. Upon your death, your named trustee will take responsibility for managing the trust and carrying out your instructions.
These days the main benefit of using a trust instead of a will is to avoid probate. Probate court makes sure your assets are distributed according to your will. But in California, this process can take a long time, be expensive, and your private information becomes public. Trusts are a better way to distribute assets quickly and privately will a minimum of expense and stress on your beneficiaries/loved ones.
All properly prepared estate plans contain a pour-over will that transfers to your trust assets that were not transferred to the trust while you were alive.
A will may be used to accomplish other things though. For example, a will may nominate guardians for minor children, provide funeral or burial instructions, or exercise a power of appointment.
Do not hesitate to discuss with Attorney Fesler how trusts, wills, and other estate planning tools can safeguard your estate, protect for your loved ones, minimize tax liability, and ensure your goals and wishes are met.