A will is the primary estate planning tool for many New Jersey residents. However, living trusts are becoming increasingly popular. By placing your larger assets, like your home, car and accounts, in a revocable living trust, you maintain control over them throughout your life. Then they transition to your beneficiaries as you designate when you pass away – avoiding probate.
The only real practical difference for you in having an asset in a living trust is that it’s titled in the name of the trust rather than simply your name. You’re the trustee of your revocable living trust while you’re alive, so you can buy, sell and transact on it easily. (You name a successor trustee who will take over the trust when you die.)
What does a pour-over will do?
You still need to create a will. However, that will is relatively simple. It basically states that any assets that aren’t in your trust at your death will “pour over” into it.
It’s a good catch-all tool and safety net that can help your loved ones and administrators avoid probate just because something was inadvertently left out. For example, maybe you bought a new boat or opened a new account but completely forgot to title it in your trust’s name. your pour-over will contains language that will let it become part of your trust and avoid probate. Some people choose to have an irrevocable living trust for tax or other purposes. A pour-over will works the same way as with a revocable living trust.
Developing an estate plan that works for you and your family is crucial. With experienced legal guidance, you can help ensure that it fulfills your goals.