Do you know the difference between a will , a living will and a living trust? Find out.
|A Will, a Living Will & a Living Trust
(Do you need one, two or all three?)
To write a will you must first know what a will is, what a will covers and doesn't cover, and what other legal estate planning documents you might want and need. A will, a living will, and a living trust are important legal documents. Every adult American should probably have one of each AND understand what each does. So that you will know the difference between a will, a living will and a living trust, I will briefly describe them and what each is used to accomplish.
What is a LIVING TRUST? You can put property into a living trust while you are still alive. When you die, your property automatically goes to your heirs without going through Probate Court, which can be very time consuming as well as expensive. You can revoke a living trust at any time if you change your mind, or simply amend and update it as situations change during your lifetime.
What is a LIVING WILL? A living will is a legally binding document that dictates one's wish NOT to be kept alive by artificial life support equipment in the event of a terminal illness or condition. By limiting treatment, a living will sets limits on hospital bills which can drain or even completely wipe out your assets, leaving little in your estate for your heirs.
What is a WILL? A will is a legal document that dictates how your property (real property, bank accounts and insurance benefits, etc.) is to be distributed after your death. It may also designate guardians for your children. Your will MUST pass through Probate Court before your estate can be distributed to your heirs. Whether you need a simple or a sophisticated will depends on your assets and you should know your situation well enough to determine if you need professional assistance in writing or filing them.
All three of the aforementioned legal documents can work together to satisfy your various estate planning needs. A living trust permits your financial assets to go to your heirs without the time and expense of probate. A will is used to cover all the property not included in the living trust; and remember, without a will the state will determine who gets your remaining property after taxes and fees have been paid.
A number of simple legal 'kits' containing fill-in-the-blank sample documents like the ones mentioned above are available at your local library as well as on the Internet. These kits are generally inexpensive and if you have the confidence to simply fill them out and file them with your local Clerk of Courts you can save a lot of money on legal fees. Only you can determine whether you need the professional services of licensed attorney, but reviewing one of these inexpensive kits can help you make that decision easier.