Estate planning is the process of anticipating and arranging for the disposal of a person’s estate. An estate plan attempts to eliminate uncertainties over the administration of a person’s property.
Estate planning involves the will, trusts, beneficiary designations, powers of appointment, property ownership,gifts and powers of attorney.
A will is a legal declaration by which a person, names one or more persons to manage his estate and provides for the transfer of property upon death.
A trust is an arrangement whereby property (including real, tangible and intangible) is managed by one person (or persons, or organizations) for the benefit of another.
A power of attorney is an authorization to act on someone else’s behalf in a legal or business matter.
Living wills, also known as Advance health care directives, advance directives, or advance decisions, are instructions given by individuals specifying what actions should be taken for their health in the event that they are no longer able to make decisions due to illness or incapacity.
Many people confuse a living will with a durable medical power of attorney. A living will sets out directives concerning end of life decisions, whereas a durable power of attorney gives all medical decision making authority, to an appointed individual upon incapacity, including end of life decisions. People may also have a combination of both.