POA, Living Will, Inter Vivos Trust? These are just a few of the confusing terms used in estate planning. Below are some commonly used terms. For the rest, you’ll find a link to a comprehensive estate planning glossary at the end of the article. It may be more than you want to know right now, but when you need it you can always find it in the Wills, Trusts & Estate Plans category at Habilinks Guide.
Potential Components of An Estate Plan
Estate Planning Documents
Beware of “do-it-yourself” forms. Requirements change and vary by state.
Do your loved ones a huge favor and do it right. Consult an estate lawyer.
Durable Power of Attorney for Finances
AKA POA for Finances, Attorney-in-Fact, Power of Attorney for Asset Management, Power of Attorney for Property & Personal Affairs.
A legal document that allows someone else to make property and financial decisions on your behalf if you become unable to make them yourself.
Irrevocable Trust
A trust that cannot be amended or revoked once it is created without the consent of the beneficiaries, trustees and grantors.
Pour Over Will
A will used in conjunction with a revocable trust to pass title at death to property not transferred to the trust during your lifetime.
Power of Attorney
AKA POA.
Authorization, by a written document, that one individual may act in another’s place as agent or attorney-in-fact with respect to some or all legal and financial matters. A power of attorney terminates on the death of the person granting the power and may terminate on the subsequent disability of the person granting the power unless the power is “durable” under the instrument or state law.
Revocable Living Trust
AKA Living Trust, Inter Vivos Trust.
A trust which allows the person setting up the trust to retain the right to alter the trust at any time.
Trust
An Estate Planning tool to help you manage your property during your life and smoothly transfer your property to loved ones when you die.
Will
AKA Last Will and Testament.
A legal document which names the individuals and organizations who are to receive your property and possessions when you die and names a representative to administer the estate and be responsible for distributing the assets to the beneficiaries..
Advance Health Care Directives
Legal instructions that outline your health care wishes in case of a medical situation where you’re not able to communicate your wishes yourself. Advance directives need to be in writing. Each state has different forms and requirements for creating legal documents. Depending on where you live, a form may need to be signed by a witness or notarized.
Living Will
A living will is a written, legal document that spells out medical treatments you would and would not want to be used to keep you alive, as well as your preferences for other medical decisions, such as pain management or organ donation.
Durable Power of Attorney for Health Care
AKA Medical Power of Attorney, Health Care Agent, Health Care Proxy.
Allows you to name the person you want to make treatment decisions if you become unable to make health care decisions yourself.
Do-Not-Resuscitate Order
AKA DNR Order.
Instructs medical staff not to use life-saving measures such as cardiopulmonary resuscitation or an automated external defibrillator.
Common Estate Planning Terms
Administrator
A person named by the court to administer your estate when you die if you don’t name an executor in your will or die without a will.
Beneficiary
The person who will receive the benefit of property from an estate or trust.
Codicil
A formally executed document that amends the terms of a will so that a complete rewriting of the will is not necessary.
Conservator
An individual or corporate fiduciary appointed by a court to care for and manage the property of an incapacitated person.
Executor
AKA Personal Representative.
The person you appoint in your will to administer your estate when you die.
Fiduciary
An individual or a bank or trust company designated to manage money or property for beneficiaries and required to exercise the standard of care set forth in the governing document under which the fiduciary acts and state law. Fiduciaries include executors and trustees.
Heir
An individual entitled to a distribution of an asset or property interest under applicable state law in the absence of a will.
Intestate
When one dies without a valid will such that the decedents estate is distributed in accordance with a state’s intestacy law.
Issue
AKA Decendents.
An individual’s children, grandchildren, and more remote persons who are related by blood or because of legal adoption.
Probate
The court supervised process of proving the validity of a will and distributing property under the terms of the will or in accordance with a state’s intestacy law in the absence of a will.
Trustee
AKA Fiduciary.
The person or institution who manages and distributes the assets according to instructions in the trust.
Trustor
AKA Grantor, Settlor, Donor.
The person who creates or contributes property to a trust.
A Comprehensive Estate Planning Glossary
Hopefully, you understand basic estate planning terms now and can leave the rest to your attorney. But if you really want to impress him/her with your knowledge of estate planning legalese, here’s the link to the American Bar Association’s Glossary of Estate Planning Terms
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