When people talk about a living will or a living trust, what do they mean? Surprisingly, these estate planning documents are very different, even though they sound similar.
A living will is not actually a will. Often called an advance directive by doctors and nurses, a living will is a document that tells medical staff what treatment (if any) you want to receive in dire medical situations when you are unable to communicate. A living will can direct doctors to withdraw life support if your illness is terminal. But anything you may put into a living will can be put into a medical power of attorney document. To avoid any misunderstandings, it may be best to avoid a living will. Instead, your attorney can help you put any living will language directly into a medical power of attorney. You should then have a detailed discussion with your designated representative about exactly what you wish under what circumstances.
A living trust, also known as a revocable trust, is a trust that can be changed at any time while the creator of the trust is still living. With a living trust, the trust creator (called a settlor) is generally also the trustee of the trust, because the trustee controls the funds and property coming into and going out of the trust. The living trust should describe who will inherit the trust property at the time of the settlor’s death. Like having a will, the main advantage of having a living trust is to avoid the expense and hassle of the complex Texas probate court system. In addition to a living trust, however, you will still need a will, in case you acquire property after creating your trust. Your will can state simply who should get any residual assets which were not included in your trust. Ask an attorney to help you set up your living trust to ensure a smooth financial transition for your family after your death.
Estate planning documents, such as a living will and living trust, can give you and your family the peace of mind you deserve. After the initial creation of your estate planning documents, be sure to have an attorney check them for necessary updates at every major milestone in your life, whether it’s the birth of a new child or a move to a new state.
