There are different types of wills and trusts used in the field of estate planning, and it can all be kind of confusing for someone who does not work in the field. This is understandable because we are in the same situation when it comes to subjects that are outside of our profession.
In an effort to provide some clarity, let’s look at the different types of wills that are sometimes used.
The one estate planning document that everyone has heard of is the simple will, which is also known as a last will and testament. You can use this document to express your wishes with regard to the way you want your assets distributed after you are gone. If you are the parent of dependent children, you can also designate a guardian in your simple will.
A living will is an advance directive for health care that has nothing to do with monetary matters. With this document, you state your preferences with regard to the use of life-sustaining measures like resuscitation, mechanical respiration, and artificial nutrition and hydration.
You can express your organ and tissue donation choices in a living will, and you can also address comfort care medications if you choose to do so.
Two people can create wills in tandem that leave everything to one another and usually have the same distribution provisions after both have died. These are called reciprocal wills, and obviously, married couples would usually be the only folks that would use this type of will.
This type of will sounds rather futuristic, but in fact, it is as old-school as it gets. A holographic will is a will that you draw up by hand on your own without any legal assistance, and it does not have to be witnessed.
They have been used carefully because they can create significant problems, but this type of will could be the only option for someone that suddenly realizes that they don’t have long to live.
About half of the states in the union recognize these holographic wills. We practice in Kentucky and North Carolina, and holographic wills are legally binding in these states.
In the places where they are allowed, they are very risky because it can be hard to defend the validity if the will is challenged. This type of situation emerged a number of years ago in California when wealthy painter Thomas Kinkade passed away of acute intoxication.
His girlfriend produced two different holographic wills that he drew up, and Kinkade’s estranged wife challenged the validity of the documents. The two women eventually worked out a settlement.
Revocable living trusts are very widely used. These trusts streamline the administration process because the assets that comprise the estate are easily identifiable and uniformly titled.
That’s the ideal in a perfect world, but even if most of your property is in the trust, you may pass away with overlooked assets still in your name. To account for this, you can include a pour-over will. This document would allow that property to be placed in the trust.
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We are here to help if you are ready to put an estate plan in place. Every situation is different, and there are many ways to proceed. The ideal course of action will depend on the circumstances, so we can gain an understanding of your situation and guide you in the right direction.
At the end of the process, you can go forward with a tailor-made estate plan that is ideal for you and your family. You can schedule an appointment at our Charlotte, North Carolina or Huntersville, North Carolina office if you call us at 704-944-3245. Our Kentucky location can be reached at 606-324-5516 (Ashland, KY) or 859-372-6655 (Florence, KY), and there is a contact form on this website you can use to send us a message.