Living Trusts versus Living Wills

There are two legal instruments with similar names that accomplish different objectives. The word “living” is used in both – Living Trust and Living Will – often leading to confusion. Use of the word “living” to describe a trust designates that the trust is controlling assets while the settlor is alive. A settlor, or a trustor, is a person who has created the trust. A living will is actually not a will, rather it is an instrument that allows you to declare how you want your health care handled if you become incapacitated. These are medical decisions made during your lifetime, hence the reason for the use of the word “living”.

Living Trusts

With respect to living trusts, the property transferred into the trust may be transferred out of the trust at any time while the settlor is living. For this reason, living trusts are often called revocable trusts. This means the settlor can revoke or terminate the trust at any time before the settlor dies. If the trust is not revoked prior to the settlor’s death, the trust continues in existence under the authority of a successor trustee. The successor, after your death, will distribute the trust property to your heirs pursuant to the directions you have provided in the trust. A principle benefit of a living trust is that it helps you avoid the probate process.

Living Wills

With respect to living wills, these are instruments that provide direction as to how decisions regarding your medical care are carried out. For example, a living will may state that you choose not to receive extraordinary life-prolonging treatment if it is unlikely that such treatment will extend your life. Living wills may also state your intentions regarding receiving food and water artificially if death is imminent and there is no hope for recovery. On the other hand, living wills also allow you to declare that you desire all available medical treatment be undertaken regardless of the nature or severity of your medical condition.

Fort Wayne, Indiana residents, and people living in any state, should consult with an estate planning attorney to document unambiguously the very important considerations associated with their medical care. Likewise, an estate planning lawyer can assist you in creating the most appropriate living trust if you wish to avoid probate and create a vehicle to manage property prior to your death, including periods of disability.