Common Estate Planning Terms & Definitions

Administrator/Executor/Personal Representative The person appointed to manage your estate after you pass - your legacy's project manager. An administrator is court-appointed if you don't have a Will, while an executor is your chosen representative named in your Will.

Amendment A formal update to your Trust or Will reflecting life changes - like your estate plan's "edit" button. This keeps your plan current with your wishes.

Beneficiary Someone you choose to receive assets from your estate, trust, retirement accounts, or life insurance. Think primary beneficiaries (first in line) and contingent beneficiaries (your backup plan).

Capacity Your ability to understand and make reasoned decisions about your assets and care. Having capacity means you're mentally equipped to create or update your estate plan.

Distributions How and when your assets go to beneficiaries. You control the timing (age milestones) and purpose (education, healthcare) of these transfers.

Estate Your financial snapshot - everything you own including property, accounts, investments, and personal items.

Fiduciary Someone legally bound to act in your best interest when managing your affairs - like your financial guardian angel.

Funding Moving assets into your trust - similar to packing valuables into a secure vault. Remember: trusts only protect what's properly placed inside them.

Heir Someone legally entitled to inherit if you pass away without a Will - your "default" beneficiaries under state law.

Guardian Your chosen caretaker for minor children, dependent adults, or pets. They step in if you can't provide care, making both personal and financial decisions.

Incapacity When you can't make or communicate decisions about healthcare or finances. Your estate plan provides instructions for this scenario.

Living Trust A private way to manage assets during life and transfer them efficiently after death, while avoiding probate. You maintain control while providing future protection.

Power of Attorney Your chosen agent for either financial or healthcare decisions when you can't make them. Think of them as your backup decision-maker.

Probate The court process of validating a Will and supervising asset distribution. Good planning can help minimize or avoid this often lengthy and public process.

Successor Trustee Your trust's future manager who steps in when you can't serve or after you pass away. Choose someone organized and trustworthy.

Testator The person creating and signing a Will - that's you when you create your estate plan.

Trust A legal arrangement where assets are managed by one person (trustee) for others' benefit (beneficiaries). Think of it as a protective container for your legacy.

Will Your written instructions for distributing assets and naming guardians after death. It's your legacy's instruction manual, but remember - it goes through probate.

What's the difference between a Last Will and a Revocable Living Trust?

While both Wills and Living Trusts help protect your legacy, they serve different purposes. A Will becomes active after your passing and provides instructions for asset distribution, but requires probate - a court process that can be time-consuming and expensive. A Living Trust offers more immediate benefits: it works during your lifetime, bypasses probate entirely, and can seamlessly manage your assets if you become unable to do so. Plus, it keeps your financial matters private while giving you more flexibility in how and when your loved ones receive their inheritance. Think of a Living Trust as an active shield for your assets, while a Will is more like a set of future instructions.

Why should I have a Living Trust instead of just a Last Will?

A Living Trust is a powerful tool that provides both immediate and long-term benefits for protecting your legacy. Unlike a Will, it helps your loved ones avoid the time-consuming and potentially expensive probate process, allowing them to focus on what matters most during a difficult time. One of its key advantages is privacy - your financial matters stay confidential rather than becoming part of the public record. Think of a Living Trust as a safety net that works in two ways: it gives you complete control of your assets during your lifetime while ensuring they're managed according to your wishes if you become unable to do so. This dual protection creates peace of mind for both you and your family, knowing there's a clear, legally-sound plan in place for whatever the future may bring. By choosing a Living Trust, you're essentially creating a smooth, private pathway for your assets to reach your loved ones exactly as you intend, without unnecessary delays or complications.

What is a Revocable Living Trust, and how does it work?

A Revocable Living Trust acts as the CEO of your Trust - think of it as a protective box that holds your assets both during your lifetime and beyond, with the CEO managing those assets. While you're alive, you remain in the driver's seat as the trustee, with complete freedom to adjust the trust's terms or even dissolve it entirely as your life circumstances change. The real beauty of this trust lies in its efficiency: it creates a smooth, private pathway for your assets to reach your loved ones without getting tangled in the time-consuming and expensive probate process.

Here's what makes it particularly powerful: you can designate a successor trustee - someone you trust to step in and manage everything according to your wishes when you're no longer able to. This creates a seamless transition of your legacy, ensuring your family has immediate access to the resources they need without legal delays or unnecessary costs.

Think of it as creating a well-organized roadmap for your assets, one that you can refine, keep private, and adjust as your life evolves, all while providing peace of mind that your wishes will be carried out exactly as you intend.

What is a Pour-Over Will?

Think of a Pour-Over Will as a safety net that catches and redirects any overlooked assets into your Living Trust after you pass away. It works hand-in-hand with your trust to create a unified approach to managing your legacy. Just as a careful gardener makes sure no plants are left untended, your Pour-Over Will ensures no assets are left outside your carefully designed trust structure.

This thoughtful combination of legal tools helps maintain the integrity of your estate plan, making sure everything you own ultimately falls under the protective umbrella of your trust. It's like having a backup plan that automatically aligns any remaining assets with your carefully considered wishes, maintaining consistency in how your legacy is managed and distributed.

What is a Power of Attorney, and why is it important?

A Power of Attorney acts as your financial safety net, putting a trusted guardian in charge of your monetary well-being when you need it most. Think of it as carefully choosing a financial steward - someone who will step in to manage everything from your daily banking needs to your long-term investments if you're unable to do so.

This essential legal tool prevents your financial life from grinding to a halt during difficult times. Without a POA in place, even your closest family members might face lengthy court battles just to help with basic financial tasks. By designating your chosen agent now, you're creating a smooth transition of financial responsibility that bypasses costly court intervention.

What makes a POA particularly valuable is its immediate effectiveness when needed. Your appointed agent can quickly step in to:

• Keep your bills current and maintain your credit standing

• Manage and protect your investments during market fluctuations

• Handle time-sensitive financial decisions that protect your interests

• Maintain your regular financial commitments to family and business

Remember, establishing a POA isn't about giving up control - it's about thoughtfully extending your financial protection when you need it most. It's a cornerstone of comprehensive financial planning that gives both you and your loved ones peace of mind, knowing there's a clear plan in place for managing your financial affairs during challenging times.

What is a Healthcare Directive, and how does it work?

Think of a Healthcare Directive as your medical game plan - it's your voice speaking clearly even when you can't express your wishes directly. This vital document serves two essential purposes: it outlines your specific healthcare preferences and designates a trusted advocate to champion your medical decisions when needed.

Just as you wouldn't want someone else guessing about your financial choices, your Healthcare Directive ensures your medical care aligns with your personal values and wishes. It addresses crucial decisions about:

• The types of life-sustaining treatments you would or wouldn't want

• Your preferences for comfort care and pain management

• Specific medical interventions that match your values

• The role of experimental treatments in your care

Your chosen healthcare agent becomes your medical spokesperson, working with healthcare providers to implement your wishes. This person isn't just making decisions - they're ensuring your voice is heard in the medical decisions that matter most. They'll have clear guidance about your preferences, helping them navigate complex medical choices with confidence and clarity.

Creating a Healthcare Directive isn't about facing difficult scenarios - it's about empowering yourself and your loved ones with a clear roadmap for your care. It provides peace of mind knowing that your medical care will reflect your values, while removing the burden of uncertainty from your family during challenging times.

What are the different care types in the event of incapacity and what do they mean?

There are 3 choices of care type in the event of your incapacity. It’s important to remember that this is the type of care you’d receive after all options have been exhausted.

1. Receive Care in All Cases This option indicates that you want all available medical treatments and interventions to sustain your life, regardless of prognosis or quality of life considerations. It typically includes:

   • Full resuscitation efforts (CPR)

   • Mechanical ventilation

   • Feeding tubes and artificial nutrition/hydration

   • Dialysis

   • Surgery and invasive procedures

   • Antibiotics and other medications

   • ICU care

   • All other available life-sustaining treatments

2. Limited Care This option allows for medical interventions with reasonable chance of recovery, but avoids extremely invasive or prolonged life-support measures. It typically includes:

   • Basic medical treatments and antibiotics

   • IV fluids and medication

   • Non-invasive oxygen support

   • May include short-term use of ventilators or other advanced interventions with clear recovery goals

   • Usually excludes prolonged mechanical ventilation, dialysis, or CPR if unlikely to result in meaningful recovery

   • May specify time limits for trying certain interventions

3. Minimal Care This option focuses primarily on comfort and symptom management rather than life extension. It typically includes:

   • Pain medication and comfort measures

   • Treatment of symptoms like difficulty breathing or nausea

   • Oral medications and fluids as tolerated

   • Oxygen for comfort

   • Excludes CPR, mechanical ventilation, feeding tubes, and other invasive life-sustaining treatments

   • Focuses on dignity and quality of remaining life rather than extending life at all costs

How do I choose the right people in my Trust?

Selecting your Trust Team is a crucial part of estate planning. Here are the key roles that work together to protect your legacy:

🧑‍💻 Trustee Your financial captain who manages and distributes assets according to your wishes. Look for someone with financial sense, reliability, and balanced judgment. Consider naming co-trustees to combine personal insight with professional expertise.

🧒 Guardian For minor or dependent adult children, this person steps in to provide care and make important life decisions. Choose someone who shares your values and has the energy and resources to take on this responsibility.

🐹 Pet Guardian Just like children, our pets need dedicated care and love. Select someone who not only adores animals but has the time, space, and lifestyle to provide a nurturing home for your pets. Consider leaving specific instructions and funds for their care.

👨‍👨‍👧‍👧 Beneficiaries These are the people or organizations who receive your assets. Consider how and when you want them to receive distributions - whether immediately, over time, or based on specific milestones.

🎁 Gift Recipients You can designate specific gifts or amounts to individuals or charities before the main distribution of your estate. This allows you to create meaningful legacies for special people or causes in your life.

Remember: Choose individuals who not only have the capability to fulfill their roles but also work well together to honor your wishes and protect your loved ones' interests.