Do you need a will with a living trust?
When you have a living trust, you also have a pour-over will. A pour-over will is a last will and testament that serves as a safety device to capture any assets that are not transferred to or included in a living trust. An important part of creating a living trust is that it needs to be “funded,” meaning that your personal assets must be transferred into the trust document via the trust document and/or retitling the assets in to the trust’s name. While “funding” a living trust can be an easy process, sometimes assets don’t always make it to the trust for a variety of reasons. If so, that asset would go through probate and be poured over into your trust.
Attorney Tom Olsen: Robert, you're on News 96.5. Go ahead.
Robert: Hi, Tom. My question is about a living trust. I'm thinking about making a living trust. Do I have to have a will also or does the living trusts cover everything?
Attorney Tom Olsen: When you have a living trust, you have a special type of will called a pour-over will, as if you took a piece of a pitcher of water and you poured it. Bill, when you have a living trust it as though you have built an empty vault or an empty safe and you must then fill it up with your assets.
To avoid probate with the living trust, it requires two things. Number one, you have a trust. Number two, your trust owns all your assets.
If you pass away with a $10,000 CD that for some reason you forgot to transfer it into the name of your trust, it's going to go through probate. It's going to be what you're trying to avoid. It's going to be governed by your pour-over will which says take that $10,000 and pour it over into my trust and dispose of it pursuant to the plan of distribution in my trust. Robert, the answer is yes. With the living trust, you do have a special type of will called a pour-over will. Does that answer your question, Robert?
Robert: Well, yes so you just don't have to have some kind of a will but you'll have actually a pour-over will.
Attorney Tom Olsen: Yes, now Robert, you're asking me this question, Robert, but first of all, if you call most attorneys in Florida and you speak these words "I want to avoid probate," they might try and sell you a living trust. Why? Because it's long, it's complicated, and that makes it expensive.
Chrissy and I, we focus on simple tools to avoid probate and in fact, we have a booklet called Easy Ways to Avoid Probate. Robert, you didn't ask me if you need a living trust but I'm telling you, before you pay for a living trust, you should check it out and see if you can use simple tools to avoid probate. We consider living trusts to be a complex tool. It can be appropriate in certain situations. Robert, if you want our booklet on Easy Ways to Avoid Probate, all you have to do is to call or text Chrissy to 407-808-8398.
Chrissy: Yes, exactly, and I was going to add is that sometimes too, in addition to what you said, to also just let Robert know and others that a will would include if you only had a will that would have your plan of distribution. If you have a living trust, you will have the pour-over will but the plan of distribution will be listed in the trust.
Tom: That's a great point, yes, Robert.