Living Will vs. Revocable Living Trust
Updated: Mar 3, 2020
In the vast array of estate planning tools and documents, it is understandable that sometimes the terminology can get confusing. However, every document serves its own unique purpose. Many people confuse living wills with living trusts because they're both estate planning options and they sound so much alike. But living wills and living trusts serve two entirely different purposes. A living trust covers three phases of your life while a living will covers only what happens if you're incapacitated.
What is a Living Will
A living will is a document that allows you to explain your wishes regarding the medical procedures you want or don't want in the event that your health becomes critical. It comes into play when — and only when — you can't voice your own wishes.
You might be in an irreversible coma, or maybe you're suffering from a terminal illness. You're no longer lucid and you can no longer express the steps you want taken to preserve — or not to preserve — your life. Do you want your heart resuscitated if it stops? Would you rather not be placed on a ventilator even if it means saving your life?
A living will is specifically designed to deal with how you feel about life-ending versus life-sustaining procedures. It can also address issues of palliative care and organ donation. It allows you to express your wishes in advance at a time when your life is not yet threatened and you're thinking clearly.
A living will only covers one stage of your life — when you're near death.
A living will can be incorporated into an advanced medical directive, a legal document that allows you to designate someone else to make health care decisions for you if you're unable to do so yourself.
An advance medical directive isn't the same thing as a living will because a living will doesn't name or appoint anyone else to speak for you. It merely states your own wishes in advance and explains under what circumstances you want health care providers to attempt to prolong your life or to cease life-sustaining measures.
What is a Revocable Living Trust
A living trust is a legal entity created by an individual to hold and own their assets after they transfer them into the trust's ownership. This property is typically invested and spent for the benefit of the beneficiary, who is typically the trust maker — the person who created the trust — at least during their lifetime.
A trust is managed by a trustee, and the trust maker also usually serves in this role, at least when the living trust is revocable. Different rules apply to irrevocable trusts. It's common to name a successor trustee as well, someone to step in and manage the trust should the trust maker become mentally incapacitated and unable to do so.
A living trust helps manage your affairs while you're alive and well. It also serves to maintain the status quo while you're alive but not so well and at your death. Your successor trustee will disperse the trust's assets to your named beneficiaries when you die, or they might keep the trust up and running according to your wishes.
However, both living wills and revocable living trusts contain safeguards in case of mental incapacity. If you should reach a point where you're no longer of sound mind or physically able to handle your financial affairs, your successor trustee takes over management of your trust. A living will does much the same thing with regard to your health care. It expresses your wishes at a time when you're unable to do so.
If you're unsure which is the right option for you or you need assistance with other estate planning options, stop by or call The Law Office of Mike D. Casterlow. I will be happy to help you navigate these complex issues.