There are a lot of terms used in the field of estate planning that sound similar, and this can be confusing to the layperson. With this in mind, we will provide some clarity with regard to two of them in this post.
Living Will
A lot of people think that estate planning is strictly about monetary asset transfers, and it can be if you do not see a larger picture. If you want to be completely prepared, you should also consider the eventualities that you may face toward the end of your life.
In many instances, people will go through progressive stages of decline before they pass away. This can happen on the physical level, and a very significant percentage of elders experience cognitive impairment.
The state could be called upon to appoint a guardian to act on your behalf if you become unable to communicate decisions on your own. While this is a necessary safeguard, it is best to choose your own representatives and record your own decisions in advance.
You can do this if you execute the proper incapacity planning documents, and one of them is a living will. With this type of will, you state your preferences with regard to the use of life-sustaining measures like mechanical respiration, artificial hydration and nutrition, and resuscitation.
If you choose to do so, you can address each different type of life support technique one by one. Your living will can also include your comfort care medication and organ and tissue donation choices.
Another piece to the incapacity planning puzzle is a health care proxy. This would give an agent of your choice the legal authority to make medical decisions on your behalf. These would be situations that are not covered in the living will.
The Health Insurance Portability and Accountability Act (HIPAA) was enacted to protect patient privacy. Because of a provision contained within it, doctors would not be able to speak freely with your agent unless you sign a HIPAA release.
Living Trust
A living trust serves an entirely different purpose. This is an asset transfer facilitator, and for many people, it is a better choice than a simple will.
One of the advantages is the ability to allow for incremental distributions to the beneficiaries over an extended period of time. If you use a will, unless you add a testamentary trust, the heirs would receive lump sum inheritances.
The estate administration process is streamlined for the trustee when you use a living trust, and you can also prepare for incapacity. You would be the trustee while you are alive and well, but you could name a disability trustee to assume the role if it becomes necessary.
Another benefit is the avoidance of probate. This is a costly and expensive legal process that strips your family of privacy. It does not enter the picture when a living trust is being administered, but a will would be admitted to probate.
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We would be more than glad to provide you with the help that you need if you are ready to put an estate plan in place.
There are many different ways to proceed, and the ideal approach will vary from person to person. This is why it is important to discuss your options with a licensed attorney.
When you choose our firm, we will put you at ease, gain an understanding of your goals, and make recommendations. Ultimately, you can go forward with a custom crafted plan that is perfect for you and your family.
You can schedule a consultation right now if you give us a call at 585-374-5210, and if you would rather reach out electronically, simply fill out the contact form on this website.
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