Why A Last Will and Testament is Still Used
When clients tell me they need to get a Last Will and Testament, two thoughts come up. First I ask myself, “does this client really need a Will or is he really looking for ‘estate planning,’ which is more thorough?” And second, I imagine dusty rolls of parchment with fancy calligraphy writing on it that are still used, but are not the primary method to transfer wealth. We recently posted about the modernized Last Will and Testament. Read about it here: Last Will and Testament: Modernized.
A Last Will and Testament, or Will for short, can transfer wealth and it can determine your wishes for your remains. But a Will alone will not avoid Probate, a very time consuming and expensive court process, when you own a home. Wills also do not have the planning flexibility as a Trust. To learn more about Wills, and how to make one yourself, see our blog video, “How to Make a Free Will.” So why are Wills still used?
Wills Pourover Property to Trust
Wills are still used as a tool in a comprehensive estate plan to help transfer non-trust property to your trust after your death. For example, let’s say you play the lottery and upon scratching off that last winning number and realizing you have struck it rich you suffer a heart attack and die on the spot. The lottery ticket is still yours and part of your estate, but it is not in your trust. If you have a Will, we can use that Will to “pour over” property to your trust. We call this a “Pourover Will.” We still have to open a probate to finalize the transfer, but your trust terms take over and can provide planning flexibility than a Will ever could.
What if I Have a Trust but No Pourover Will?
Things get messy without a Will. In the example above, your lottery winnings will pass according to state law unless we can prove that you intended to hold this winning lottery ticket – that you just scratched off – in your trust. This can be difficult without some kind of supporting evidence. Plus, family members that would never benefit under your trust (because that is the way you planned it) could benefit by fighting your estate. Imagine: you decide to disinherit a child because he married a wealthy baroness – he’s wealthy and doesn’t need the money. Instead, you leave everything to your daughter, a county social worker. If the lottery ticket is in your trust, your daughter gets the lottery winnings. If not, the winnings are unfairly split between your public-servant daughter and wealthy son.
So, a Last Will and Testament is still used as part of an estate plan. But we don’t use calligraphy and dusty scrolls. To learn more, schedule a free 20-minute consult with our firm.