Is a living will different from a living trust?

A living will and a living trust are two very different legal instruments. A living trust can help you manage and control property during your lifetime and can also allow you to distribute that property upon your death. When you create a living trust, you do so while you are still alive. This means that in most cases, you name yourself as the trustee. You will transfer all or most of your property to the trust during your lifetime. A living will, by contrast, is not actually a will at all, but a tool that can allow you to control and manage your health care if you become incapacitated.

Revocable Living Trusts

Living trusts are also sometimes called revocable trusts, because the property that you transfer into your trust can also be transferred out of it at any time. You can also change or cancel the trust itself whenever you wish. This is what makes it truly revocable.

If you establish a living trust, you will also need to name a successor trustee. The successor will control the living trust after you are no longer able to manage it. After your death, the successor trustee will be responsible for distributing the trust properties to your beneficiaries under the directions provided in the trust. A central benefit of the living trust process is that it helps you prevent your estate from going through probate.

Living Wills

A living will is much simpler than a living trust, and it controls a different set of affairs. A living will allows you to document how you want your health care to be handled if you should become incapacitated and unable to make health care decisions for yourself. For example, you might use a living will to state that you don’t want to be kept on life support longer than a specified time unless there’s a strong likelihood you will recover; or you might say that you want to be kept on life support as long as possible. A living will doesn’t concern your property, only your desires regarding health care.

For more information on establishing a living trust or living will, explore our articles on estate planning. If you are interested in creating a living trust, be sure to consult with a qualified estate planning lawyer in order to ensure you have created the most effective trust possible for yourself and for your heirs.

Case Studies: Understanding the Differences between Living Wills and Living Trusts

Case Study 1: Property Distribution and Probate Avoidance

A person creates a living trust during their lifetime to manage and control their property. They transfer their assets into the trust and name themselves as the trustee. The trust document specifies how the property should be distributed upon their death, and they also appoint a successor trustee.

Upon the person’s death, the successor trustee takes over the trust and distributes the assets to the beneficiaries according to the trust’s instructions. In this case, the living trust helps avoid the probate process, saving time and potential costs associated with probate. Insurance considerations may involve the coverage of the trust assets to protect against potential loss or damage.

Case Study 2: Health Care Decision-Making

An individual creates a living will to document their healthcare preferences in case they become incapacitated and unable to make decisions. The living will includes instructions regarding life support, medical treatments, and end-of-life care. In this case, the living will provides guidance to healthcare providers and family members, ensuring that the individual’s wishes are followed.

Insurance considerations may involve health insurance coverage and the inclusion of advance care directives within insurance policies to align with the individual’s living will.

Case Study 3: Legal Expertise and Estate Planning

An individual wants to establish both a living will and a living trust to ensure comprehensive estate planning. They consult with a qualified estate planning lawyer to create these legal instruments tailored to their specific needs and goals. The lawyer advises on the legal requirements, potential tax implications, and the overall effectiveness of the living will and living trust.

Insurance considerations may involve professional liability insurance for the estate planning lawyer to protect against claims arising from errors or omissions in providing legal advice and services.