How Can a Will Safeguard Your Wealth for Family?
Video Transcript
Ray Hrdlicka – Host – Attorneys.Media
You have mentioned several different instruments here that you can utilize in estate planning. Let’s talk about them for a second.
Again, in my prep for this interview—let me read them and then talk about them.
Last will and testament.
Financial and healthcare power of attorney, living will, and a living trust.
Some of those might be similar to each other, but I’d like you to explain the difference, please, and what they’re used for.
Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA
So let’s start with the last will and testament. That’s just the lengthy phrase for what we all shorthand call a will.
A will is your declaration about who you trust to serve as the executor of the will to follow through with your intentions. The will identifies the beneficiaries you wish to bless, and there may be a reference to the assets you have. So, it’s pretty similar to what I mentioned earlier about the trust. You identify what you have, you identify who you want to bless, you identify who is the trusted representative for you.
The will is appropriate for all those assets that are not in a trust—in other words, in a situation where there could potentially be a probate. So that’s what a will is.
The last of the four things you mentioned is called a living trust. A living trust is basically what I told you about earlier. A revocable trust is sometimes called an inter vivos trust. “Inter vivos” meaning “among the living,” so it’s a living trust.
It’s what you do now in your lifetime, and it’s amendable and revocable at your pleasure. That’s just really what it means when it’s living—it’s for you when you’re alive, managing your estate. That’s the trust that we talked about earlier, the revocable trust.
The third thing you mentioned is a living will. So let’s break that down. That’s under the category of what kind of document you want to prepare that will allow the world to understand who you trust to make health care decisions for you. There are kind of three types of documents here.
One is called an advanced health care directive. That just means in advance of a health care need, you are identifying the directives or instructions you want someone to follow.
The general approach for most people with this is: Who’s going to make healthcare decisions if I get into an accident and I can’t make a decision? If I’m so badly injured, or if I’m no longer healthy enough to make those decisions, I need someone to make decisions for me. Ultimately, it relates to what kind of care you want your representative to advocate for with your medical provider.
So, if I got ill, I would have my daughter make decisions for me. She knows what my general goals would be. One is I don’t want to be kept alive artificially only because there’s technology, but I would like to be kept comfortable.
The four things that people look at are: what will keep me comfortable; I’ll take fluids so I don’t dehydrate; I’ll take food if that means the nourishment will make me feel more comfortable; I’ll take medication; and I’ll take pain medication, right? Not so much that I’m not present, but enough so I’m comfortable.
I remember when my father was almost gone—we had hospice, we brought him home, and he had a morphine drip. When he felt the pain was too much, he could have that little gizmo where he could pump it a couple of times and get a tiny spritz of morphine to feel comfortable. The idea was we gave him morphine so he was comfortable, not to prolong his life, but just to make sure he was comfortable.
So you want to hydrate, have food, have oxygen, and be able to have pain medication or some kind of medication to help the situation, so the person is comfortable and then would pass away in the natural order of things.
So I assume that is the health care power of attorney that you’re talking about.
That is correct.
There are two other things that I mentioned. The living will is sometimes a statement that says, “I don’t want to be kept alive artificially.” It’s essentially covered if you have an advanced health care directive.
Then the third document is a do not resuscitate, a DNR. That just simply means, “Look, if I am not well, I’m ill, and my heart fails because of the situation, I don’t want you to revive me if I really go into a coma.” Actually, probably not technically a coma, but you don’t want to revive somebody simply because you can. At some point, you don’t want to do those activities just because you can keep somebody alive. It just recycles the situation over extended days or weeks.
So those are the three: a living will, a do not resuscitate, and an advanced health care directive. A proper advanced health care directive probably should address all of the three documents together, so it’s a single, complete document that does the work for you.
And then there’s one more document—and that’s the durable power of attorney for financial affairs. That’s the same as the durable power for health care, right? It’s like in a conservatorship or a guardianship. There’s a guardianship of the person and a guardianship of the estate.
The durable power of attorney addresses the financial side. That’s the same as a guardianship or conservatorship of the finances. Then there’s the guardianship or conservatorship over the person—and that’s the health care issues. There’s money, and then there’s the person.
Andrew Dósa – Estate Planning Attorney – Tacoma WA and Oakland, CA
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