Living wills and trusts are both important estate planning documents, but they serve different purposes:
A living will, also known as a healthcare directive, is a legal document that outlines your wishes for medical care in case you are incapacitated and unable to make decisions for yourself. It allows you to specify things like:
Whether you want to be resuscitated if your heart stops
Whether you want to be placed on life support
The kind of pain medication you want to receive.
A living trust is a legal arrangement that allows you to transfer ownership of your assets (like property, investments, etc.) to a trust. You, as the grantor, can still control and benefit from the assets during your lifetime. You then designate a trustee to manage the assets according to your wishes in the trust document. Here are some key features of a living trust:
Avoids probate: Assets held in a living trust typically avoid probate, a court process that oversees the distribution of an estate after death. Probate can be time-consuming and expensive.
Provides for incapacity: If you become incapacitated, the designated successor trustee can manage the trust's assets for your benefit.
Privacy: Living trusts are generally private documents, unlike wills, which become public records during probate.
In short:
A living will deal with your healthcare wishes in case of incapacity.
A living trust deals with the ownership and management of your assets during your lifetime and after your death.
Do you need both?
It depends on your individual circumstances. Here's a general guideline:
A living will is a good idea for most adults, regardless of their assets.
A living trust can be beneficial if you have a complex estate, you want to avoid probate, or you need someone to manage your assets if you become incapacitated.
Witnesses may be needed for the signing. Review the documents.
Multiple notary acts may be needed during the signing process. Count the number of stamps needed.
I recommend consulting with an estate planning attorney to determine which documents are right for you.