Many people who might benefit from creating trusts assume they do not have enough resources to properly fund one. Some people address inadequate funding by arranging to have their primary residences or their life insurance policy proceeds transferred to a trust after their passing.
Other times, it is possible to fund a trust with property owned by a trustor at the time of their death. The creation of a specific type of will can allow for trust funding after a person passes.
Pour-over wills allow for probate transfers
Frequently, individuals establishing trusts fund them with their largest and most valuable assets. Trustees can manage, liquidate and distribute a broad range of resources, not just highly valuable assets. In some cases, it may make sense to have the entirety of an individual’s estate, including their remaining personal property and financial resources, transfer to a trust after their passing.
This arrangement allows them to retain control over those assets while ensuring that the trust manages them according to their wishes after their passing. A pour-over will is a testamentary instrument that allows for the transfer of property to a trust after the owner’s death. Pour-over wills are an excellent solution for assets not previously transferred to a trust or addressed in other aspects of an estate plan, especially if testators worry about disputes or the misuse of an inheritance.
Exploring different estate planning solutions, including different types of trusts and wills, can help people choose the legal instruments that fulfill their unique needs. Pour-over wills are one way to fund a trust created as part of a comprehensive estate plan.