Estate planning is an essential part of financial management that should be addressed early on in a doctor's career and updated periodically as they grow older. In fact, it could even necessitate modifications every five to seven years or when major life changes take place (such as marriages, divorces, the births of children or grandchildren), relocation to another state, or noticeable changes in estate tax laws.
Crafting an effective estate plan requires utilizing all the right tools. One of those invaluable resources is a pour-over will, which can be exceptionally beneficial in covering any assets you may have overlooked during the initial process.
What is a Pour-Over Will?
A pour-over will is used in conjunction with a living trust. When you set up a living trust, having a pour-over will is essential to ensure that any of your assets not included in the trust are still transferred into it at the time of your death. This way, all your belongings end up where they're supposed to be - with the beneficiaries chosen by you and stipulated within the terms of this type of will.
Keeping a current pour-over will not only save you time but also money, since it eliminates the requirement of constantly altering your trust whenever assets are added or subtracted. With this document in place and all valuable items secured in the trust, any property left out of your estate at death can be accounted for.
How Does a Regular Will and a Pour-Over Will Differ?
A traditional will allows you the flexibility to make decisions that have a long-term impact on the lives around you.
It enables you to:
● Choose a guardian for your children in case something happens to both parents
● Appoint someone who is qualified enough to make medical decisions when it comes time
● Distribute any inheritance amongst family members or friends
In contrast to other types of wills, a pour-over will only has one purpose: to transfer assets into your living trust. Of course, you can still provide for individual loved ones in the will - however, it is designed specifically with language that aims to benefit the trust.
Through the construction of a pour-over will, you are conveying your wishes to the state that all non-trust assets should be poured over into your surviving trust after death. This is an effective way of ensuring that all possessions transfer seamlessly and securely from one generation to another.
How Can I Create a Pour-Over Will
To effectively and legally create a will, you must meet certain requirements.
● having the testamentary capacity to create the document
● putting the will in writing; signing it with your signature; as well as having two witnesses of execution.
● In addition, if there are pour-over wills involved, the trusts should be created prior to or at the same time as when making out your last wishes.
Be sure to research your state's law because some may require additional preconditions for creating a valid will.
What Are The Advantages of A Pour-Over Will?
For optimum protection of assets not transferred into your trust before you pass, a pour-over will can be an invaluable tool. California has recently made it easier than ever to create these wills—even if you haven't yet established the trust.
Here are several advantages to using one:
● Efficiency – A single document makes the management process more straightforward and efficient for all parties.
● Asset completion – Valuables that may have been inadvertently omitted in your initial will can be taken care of with a pour-over.
● Privacy - The information regarding your estate is kept confidential since trusts aren't public documents. With these benefits, it's no wonder people opt for this type of will!
What Are The Disadvantages of Pour-Over Wills?
When you pass away, the executor of your estate will undertake the task of processing it. Probate must first be navigated before they can carry out their duties; these usually involve collecting assets and discharging loans and debts. In reality, a pour-over will is fundamental in any comprehensive estate planning strategy - an attribute that should not be overlooked!
When it comes to a pour-over will, the executor is responsible for transferring your assets that are subject to this type of will into the living trust you created. Afterwards, the trustee appointed by you has to gather these possessions and divide them among those named as beneficiaries in your trust document.
Why Doctors Need a Pour-Over Will
Although no one wants to think about it, it’s important that you plan for it. A pour-over will ensure that one of your greatest assets, your practice, lands in the right hands in the event of your passing.
For those seeking to create a Pour Over Will as part of an Estate Plan, consulting with an experienced estate planning lawyer is the most effective way to ensure your wishes are honored. The best way to think of a pour-over will’s purpose is as a safety net for your assets. Selecting a trustee for the trust is the first step. Once assets have been transferred into it and beneficiaries named, your trust can be managed by this individual as soon as they assume their role. After setting up and funding your Living Trust, another crucial move would be creating a Pour Over Will that designates the same beneficiary - namely your Trust - instead of specific people or entities. This allows any part of the Will's contents to transition into ownership within your Trust upon passing away.
Is a Pour-Over Will Right For You?
California recently made the process of creating pour-over wills easier, which makes them an excellent option for anyone seeking to protect assets not transferred into a living trust before they pass away. Even if you don't yet have a trust established, writing one of these wills allows you peace of mind knowing your estate is secure.
However, do bear in mind that legal restrictions may apply and certain circumstances could invalidate such documents - so make sure to consult with an experienced attorney on whether or not this kind of will can best serve your long-term loan.
Contact a Trusted Estate Lawyer to Help
Estate Planning can be a complicated and challenging undertaking, but with the correct counsel and assistance, you can accomplish each step. One of the most essential components for success is to obtain an attorney specialized in estate planning. Acquiring their advice will provide you with invaluable knowledge on how best to go about this procedure.
With their in-depth knowledge and expertise, they can guide you through the difficulties of legal complexities and regulations. They will not only give you sound advice on the best plan of action to take but also help secure your assets from potential harm.
Estate planning can be a difficult and delicate journey to undertake. Even though it might appear overwhelming, the Dental and Medical Counsel estate planning legal team is here for you every step of the way. We take pride in being the top law firm for medical professionals throughout California and beyond. Reach out to us now so we can show you how our services may help safeguard your assets!
Q: What types of assets can be included in a pour-over will?
A: Any assets that are not included in the grantor's trust can be included in a pour-over will. This could include real estate, personal property, bank accounts, and other financial assets.
Q: How is a pour-over will different from a regular will?
A: A pour-over will is different from a regular will in that it is specifically designed to work in conjunction with a trust. It does not typically include detailed instructions for the distribution of assets, as those instructions are contained within the trust document.
Q: What are the advantages of using a pour-over will?
A: Some of the advantages of using a pour-over will include the ability to simplify the estate planning process, ensure that all assets are included in the trust, and provide for the distribution of assets in accordance with the grantor's wishes.
Q: What are the disadvantages of using a pour-over will?
A: One potential disadvantage of using a pour-over will is that it may require additional probate proceedings, which can be time-consuming and expensive. Additionally, if the pour-over will is not properly executed or funded, some assets may be left out of the trust and subject to probate.
Q: Do I still need a regular will if I have a pour-over will?
A: Yes, it is generally recommended to have a regular will in addition to a pour-over will. The regular will can be used to provide detailed instructions for the distribution of personal property and to appoint guardians for minor children, among other things.
Q: Do I need an attorney to create a pour-over will?
A: While it is possible to create a pour-over will on your own using a template or online software, it is generally recommended to work with an experienced estate planning attorney. An attorney can help ensure that the pour-over will is properly executed and funded, and can provide guidance on other estate planning issues such as tax planning and asset protection.
At Dental & Medical Counsel, PC, we understand navigating the legal process can be tricky. We believe every doctor deserves the best advice and service so doctors can do what they do best, treat their patients. We make their lives easier by providing expert guidance, so they can focus on their personal and professional aspirations.
About Ali Oromchian, Esq.
In addition to practicing law for almost 20 years, Ali is also a renowned speaker, throughout North America, on topics such as practice transitions, employment law, negotiation strategies, estate planning, and more! Ali has helped hundreds of optometrists realize their professional goals and looks forward to aiding you in navigating the legal landscape.
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