Wills
And Their Role in Estate Planning
By Daniel Khaldarov
A will is one of the most commonly known tools in estate planning, designed to direct how your assets will be distributed after you pass away. It allows you to:
- Name beneficiaries who will receive your assets.
- Appoint guardians for minor children.
- Designate an executor to manage your estate.
- Specify other wishes, such as how personal belongings or family heirlooms should be passed on.
While a will serves important functions, it does not offer any protection if you become incapacitated, nor does it bypass the legal process of probate—and this is where many of its limitations come into play.
The Downsides of Probate
Probate is the court-supervised process of validating your will and distributing your assets according to its instructions. Unfortunately, probate can bring a number of challenges:
- Delays: Probate often takes months, or even years, before beneficiaries receive their inheritance.
- Costs: Court fees, attorney fees, and other expenses can reduce the value of the estate. These costs can be significant, and sometimes leave nothing to your beneficiaries.
- Lack of Privacy: Probate is a public process, meaning details about your estate, assets, and beneficiaries become part of the public record, which can expose sensitive family information.
- Potential for Disputes: Probate opens the door for family members or other individuals to challenge your will, which can lead to lengthy and costly legal battles.
Given these downsides, many people seek ways to avoid probate altogether. One of the most effective tools for this is a trust.
Why a Trust Can Help You Avoid Probate
A living trust allows you to transfer ownership of your assets to a trust while you are still alive. Upon your death, the trust distributes those assets to your beneficiaries without going through probate. The benefits of using a trust include:
- Avoiding probate: Assets held in a trust are not subject to probate, which means your beneficiaries receive their inheritance faster and with fewer legal expenses.
- Maintaining privacy: Since trusts do not go through probate, the distribution of assets remains private, keeping your financial affairs out of the public record.
- Continuity in case of incapacity: A trust can also provide for the management of your assets if you become incapacitated, something a will cannot do.
By setting up a trust-based estate plan, you can ensure a smoother, quicker, and more cost-effective transfer of assets to your loved ones. However, even in a trust-based plan, a pourover will remains an essential component.
The Role of a Pourover Will in a Trust-Based Estate Plan
A pourover will acts as a safety net to ensure that any assets not already placed into your trust during your lifetime are still managed according to your wishes. If you forget to transfer an asset to your trust or acquire new assets after creating your trust, the pourover will directs that those assets be “poured over” into the trust upon your death.
Although assets covered by the pourover will still have to go through probate, the overall probate process is often simpler and less expensive when compared to managing an estate solely through a traditional will. Additionally, once the assets are moved into the trust, they will be distributed according to the terms of the trust, which provides more control and flexibility over how and when beneficiaries receive their inheritance
A Will Won't Help You if You Become Incapacitated
Additionally, a will only takes effect after you pass away, so it provides no protection or guidance in the event that you become incapacitated. If you are unable to manage your finances or make decisions due to illness or injury, your assets could become tied up, and a court may need to appoint a guardian to make decisions on your behalf.
To avoid this, a living trust can have a successor trustee step in to manage your assets if you become incapacitated. Additionally, a power of attorney and a health care proxy allow trusted individuals to make important decisions for you, ensuring that your affairs are managed smoothly without court intervention and your healthcare wishes are respected.
Conclusion: Create a Comprehensive Estate Plan
While a will remains a vital document in any estate plan, its limitations—especially the requirement to go through probate—make it less than ideal as the sole vehicle for transferring assets. By incorporating a living trust, power of attorney, and health care proxy alongside a pourover will, you can create an estate plan that offers better protection, more privacy, and a smoother transition of assets to your loved ones.
Contact the Law Office of Daniel Khaldarov and ask for a consultation about creating an estate plan. With the right plan, you can ensure your wishes are honored, and your family is spared unnecessary complications during a difficult time.
