What Is the Difference Between Will and Estate Planning?

What Is the Difference Between Will and Estate Planning?

Posted on November 4, 2024 in probate

Having a plan for what comes next after you pass away is important, especially if you are the owner of a significant estate and there are beneficiaries whom you wish to take care of. Before that can happen, though, it is important that you take the proper steps to protect not only yourself but your estate. The last thing you want is to be unprepared in case something were to happen. You may ask, “What is the difference between will and estate planning?” The answer is significant.

The Difference Between Wills and Estate Planning

Simply put, the primary difference between a will and estate planning is how each is approached. A last will and testament is a legally binding document that details how your assets are supposed to be divided upon your death. Estate planning is simply the overall strategy that covers how and when all relevant assets will be distributed.

A will is often part of one’s estate planning process, but estate planning also covers a number of other important documents relevant to asset distribution. A Las Vegas estate planning lawyer can figure out the most effective way to create and manage your estate plan.

What Is a Will?

A last will and testament is essentially the foundation of a solid estate plan. Anyone with assets to protect should draft a will that details their exact desired plan for their assets. After all, you don’t want to be unprepared. If something were to happen to you and there isn’t a will, your assets could be distributed among people you may not want to share in your good fortune.

A will is legally binding. It is a set of important instructions that your estate’s executor or designated representative will administer upon your death. You will be the one to name the executor in the will itself, and it should be someone you trust to manage your assets and oversee the will’s instructions. They will also likely need to be supervised by probate court when the time comes to distribute the will’s assets.

Living Will

A living will is somewhat different from a last will and testament. In a living will, you can detail your wishes for your medical care should you end up in a medical situation where you are cognitively incapacitated or otherwise unable to carry out your own medical wishes. The living will contains your instructions regarding life support and allows you to give somebody you trust your healthcare power of attorney. They can then make medical decisions on your behalf.

What Is Estate Planning?

Estate planning is a comprehensive and detailed plan for how the assets of an estate will be managed and distributed upon its owner’s death. A will is often a significant part of an estate plan. Here are some additional elements of an estate plan that are generally included:

• Wills and Trusts: Your will should be written up and properly notarized so it can be easily used to distribute assets when the time comes. A trust is an alternate route for your assets that involves giving one party, the trustee, the right to hold your assets or money for you or your heirs. Trusts are sometimes used to reduce estate taxes and avoid lengthy probate court.
• Power of Attorney: It is very important that you designate someone in your will to have your power of attorney. The person you give this power to can act on your behalf when you cannot do it yourself, such as if you are medically incapacitated. Without it, decisions regarding your welfare will be left to the court, medical personnel, or your close family.
• Letter of Intent: A letter of intent details your exact plans for certain assets. It may also contain specific instructions for your funeral or additional special requests. If the will is deemed invalid for whatever reason, a letter of intent can show what you wanted for your assets.

FAQs

Q: How Does Estate Planning Differ From a Will?

A: Estate planning differs from a will in many ways. The primary difference is that estate planning is an overall process, while a will is a single document. The will is the part of the estate plan that specifies the distribution of your assets after your death. The estate plan will also contain trusts, powers of attorney, and other important documents.

Q: What Is Meant by Estate Planning?

A: Estate planning is the overall process of making important arrangements for your assets. In an estate plan, you will detail how you want your assets distributed and your funeral arrangements made in the event of your death. Estate planning can make sure everything is handled the way you want and even reduces taxes, family conflicts, and court proceedings.

Q: What Are the Disadvantages of a Will?

A: There are several disadvantages of a will. It is not the most effective solution for everyone. For example, a will has to go through a lengthy probate court process. Probate can be costly and take months or even years to fully finalize. Wills can open your assets up to disputes, usually among family who may feel entitled to your success, despite what the will says.

Q: What Is the Difference Between a Living Will and an Estate?

A: There are many differences between a living will and an estate. Largely, a living will is a legal document that provides detailed instructions for your own medical care if you become mentally incapacitated and can no longer make important medical decisions. An estate is a detailed plan that provides instructions on how to protect your assets in the event of your death.

Reach Out to an Estate Planning Lawyer Today

It can be an exhausting and confusing process to plan your will or engage in estate planning. You should consider hiring an estate planning lawyer who can provide you with consistent legal advice throughout this process. The legal team at Ken R. Ashworth & Associates understands how difficult this entire process can get, and we are prepared to offer you assistance. Contact us to schedule a consultation with a valued team member today.