Do You Mean Living Trust or Living Will?
I have been drafting wills, trusts and related documents for 20+ years, and can't count the number of times people have used the terms Living Will and Living Trust interchangeably. Clients are not expected to know the names of the tools they need to accomplish their goals. They just need to explain their goals and the attorney can provide the tools. Nevertheless, in this blog I will try to explain the differences and easy ways to remember the differences between a Living Will and Living Trust. If you want a more in depth description for each term you can find that information on our website.
Living Trust
A Living Trust is a trust. Most people are familiar with the basic structure of a trust. You put money in a bank account that is owned by a “trust” or you transfer the title to property so that the new owner is the trust. A person called a trustee is responsible for managing the money and property. The benefits of the money and property are given to a person called a beneficiary. To call it a living trust just means you created the trust while you were alive. The trust is active while you are "living."
This is compared to a testamentary trust, which means you created it in your will, e.g. Last Will and ‘Testament.’ Just as other property in your will, you do not transfer any money or property to the trust until you pass away. In other words, the trust does not become active until your death.
Living Will
A Living Will could be confused with a last will and testament. But they are not alike. In the simplest description, a living will is a document you create to let your physician know whether you want to be placed on life support not. You can think about it as telling the physician your “will” to survive or not survive. The document is used in the event you are unable to communicate.
Advance Directive
A living will falls into a broader category of Advance Directives. Advance Directives not only include living wills but also includes durable healthcare powers of attorney (which you use to name someone to make healthcare decisions for you), and Do Not Resuscitate Orders.
Now you are armed with easy ways to remember these terms. You will be able to use the terms Living Trust and Living Will correctly and help others understand the differences, too.
Conclusion
If you would like to have an Living Trust or Living Will and other related documents, you can contact us at hspires@TexasWillsLawyer.com. It is okay if you forget the proper name of the document you want. We will be glad to discuss them with you.