Living Will - A legal document that sets out the medical care an individual, or the principal, wants or does not want in the event that they become incapable of doing it themselves. -Dictionary.com

Wills

Will Validity
While people talk about wills somewhat casually, most people aren’t completely clear on what a valid will is and how to create one. Almost any writing that is meant to provide direction regarding the distribution of an individual’s property upon the person’s death will be considered a will. The legal validity of a will depends upon whether it is clearly the intent, or will, of the person that has passed away. If there is a question as to whether it was the true intent of the deceased, the court might not honor the will as valid and will distribute the property according to intestate laws, instead of according to the directions of the will.

There are two types of wills one is the witnessed will and the other is the holographic will.

A witnessed will is exactly what it sounds like. The document is signed by the testator (the individual considered in the will), with two other individuals as witnesses to the signing. To avoid questions of possible coercion, the witnesses should be impartial and not able to benefit from the will being signed. While not required by law, it is best to also have the testator and the witnesses attest to the fact that the testator is of sound mind and signing the document willingly, as documented by a notary public. This extra step eliminates the need to “prove up” the will after the death of the testator.

A holographic will is what legends and old movies are made of. It is a will in which the material portions are set out in the testator’s handwriting, as well as signed by the testator. It is valid even without witnesses, though having witnesses, especially if the witnesses attest to the testator’s mental state as discussed above, will make it much easier for a court to accept the holographic will as valid.

Will Changes
Wills can be revoked, amended or replaced at any time by the testator. So, while it is important to give careful thought to the contents of your will, you have the ability to change it for any reason at all. Changes must meet the same requirements as the original document.

Will Purposes
Besides simply disposing of your estate, wills can be used for at least three other critical purposes: those of naming your executor, naming a guardian for your minor children, and of creating trusts.

Without direction, the court will rely upon information it can accumulate to determine an executor, or personal representative, to distribute your estate. Many people feel more comfortable knowing that a particular person will be responsible for this important work, so most people name a personal representative within the will. It will require unusual circumstances for a court to go against the testator’s wishes in filling this position.

While it is not necessary to create a will in order to name a guardian for minor children, it is probably the most common instrument used for that purpose. It is an excellent use of the will, as a will is not considered until the death of the testator, and generally a guardian for children is not needed without that unfortunate event. (Guardianships established for other reasons should be established through separate documents.) Naming a guardian is, arguably, one of the most important reasons for creating a will, because without direction, the court is left to its own devices to determine who will be the best care-provider for minor children.

Finally, many wills also incorporate testamentary trusts. These trusts, as opposed to inter vivos trusts, only begin operating upon your death. They can be revoked or changed at any time, just like the other portions of your will. 

Living Wills

Declarations as to Medical or Surgical Treatment, popularly known as Living Wills or Advance Directives, have received a lot of attention in the past few years. While most governments have always recognized the rights of individuals to make their own decisions regarding medical treatment, advances in science and medicine have brought forward issues that our ancestors did not have to consider.

To be legally effective, a living will must be executed before two witnesses, and is generally notarized. Many courts have interpreted the statute governing living wills as requiring that two physicians must certify as to a patient’s incapacitation for a period of seven consecutive days before the will can be given effect. This requirement, in conjunction with any reluctance on the part of your medical team to follow your advance directives, suggests the wisdom of also creating a Medical Power of Attorney. The two instruments should be drafted to not conflict, but to work together to ensure you receive the medical strategy you desire.

Trusts

A trust is established when a person holds property for the benefit of another. There are three entities involved in a trust. First is the settlor, or individual that provides the property to be held in trust and who establishes the trust. Second is the trustee, the person that will be responsible for the property in the trust but who does not benefit from the trust. Finally, there is the beneficiary, the person or persons for whom the trust is established and who will benefit from the contents of the trust.

Trusts can be quite simple or extremely complicated. They can be divided into many categories, such as inter vivos trusts (those that begin operating during the life of the settlor) and testamentary trusts (those that begin operating upon the death of the settlor). The average person in the U.S. generally uses a trust for one of two reasons – or for both. Most people use a trust to ensure that loved ones have the proper finances for their care and well-being, and/or to legally avoid the need to pay federal estate taxes.

Trusts can be a great way to provide for loved ones. They can ensure that minor children enjoy the benefits and lifestyle you hope to provide for them while you are alive. Or, they can provide a framework that assists individuals with a history of poor money management because the money will be controlled and managed by the trustee. They can be conditional, so that a person will only benefit if he or she needs assistance, such as entering a nursing home or attending college.

Finally, trusts are also used to avoid incurring federal estate taxes. Stated in simple terms, the money in a trust does not belong to the beneficiary, so the beneficiary will not pay taxes on money that remains in the trust (though the trust may have tax obligations). Upon the death of the beneficiary, any money remaining in the trust will not be included in the beneficiary’s estate, which, when properly planned, can allow the value of the estate to remain below the amount requiring payment of the federal estate tax.