How Revocable Trusts and Pour-Over Wills Work Together: A Practical Estate Planning Approach in Washington State
When creating an estate plan, revocable living trusts (RLTs) and pour-over wills complement each other effectively, ensuring comprehensive coverage for your assets. Understanding how these two estate planning tools operate together can clarify the process for your beneficiaries, making estate administration more efficient and less stressful.
The Combined Role of Trusts and Pour-Over Wills
A revocable living trust allows you to place assets into a trust during your lifetime, potentially avoiding probate upon your death. A pour-over will complements this by addressing any assets unintentionally left outside your trust, directing them into the trust after probate or via simpler transfer processes if eligible.
How the Process Works
During Your Lifetime:
Initially, you establish your revocable living trust, transferring significant assets into it. At the same time, you also execute a pour-over will, naming your trust as the beneficiary for assets not already titled in the trust.
At the Time of Death:
Upon death, assets already in the trust or with the trust named as the beneficiary become immediately accessible to your successor trustee. These assets can be distributed efficiently according to your trust’s instructions without probate delays.
Assets remaining in your individual name, without beneficiary designations or joint ownership, generally go through probate as directed by your pour-over will. However, smaller assets (totaling less than $100,000), such as a small bank account or vehicle, may qualify for Washington’s Small Estate Affidavit procedure, simplifying or eliminating formal probate requirements entirely.
Benefits of a Coordinated Approach
Comprehensive Coverage:
The trust typically handles significant and clearly identified assets, while the pour-over will addresses the less obvious or later-acquired items, providing thorough coverage of your estate.
Practical Probate Management:
When probate is required, it often involves fewer assets, making the process simpler and quicker. In practice, however, assets subject to probate may still experience some delays, as procedural requirements must be met before distribution occurs. Meanwhile, trust-held assets remain available immediately to handle estate expenses or financial obligations.
Enhanced Privacy:
Assets passing through the trust remain private, unlike assets distributed through probate, which are public record. Using a trust minimizes public disclosure of your estate details.
Real-Life Example: Linda’s Practical Plan
Consider Linda, who carefully transferred her home, main investment accounts, and checking accounts into her revocable trust. She also had a pour-over will to address any overlooked assets.
When Linda passed away, her major assets passed immediately to her beneficiaries without probate. However, Linda had opened a small savings account and overlooked placing it into the trust. Because the account balance was modest, her family used a Small Estate Affidavit to quickly transfer the account to the trust without formal probate. Ultimately, all Linda’s assets were distributed efficiently according to her plan.
Final Thoughts
Pairing a revocable living trust with a pour-over will creates an efficient and practical approach to estate planning in Washington State. This combination addresses both the obvious and less predictable aspects of asset management after death, ensuring your estate plan is comprehensive yet flexible, and practical for your beneficiaries.