Estate Planning Definitions
ESTATE PLANNING TERMS
The following are some of the more common Estate Planning terms.
A trust is a type of estate transfer and is a fiduciary relationship in which you give another party authority to handle your assets and property for the benefit of a third party otherwise known as your beneficiaries. There are many different types of Trusts including living trusts, testamentary trusts, revocable trusts, irrevocable trusts, asset protection trusts, charitable trusts, special needs trusts, and many other specialized types.
A Trust Administrator is responsible for the management of the trust property according to the trust document’s terms and for the benefit of the beneficiaries after the settlor’s death. When an individual dies without leaving a will, a Trust Administrator is appointed by the California probate court. The Administrator is chosen from a list of relationships to the decedent. A Trust Administrator is entitled to receive payment from the estate for their services.
A Trustee is an individual person or a member of a board given control or powers of administration of the property in a Trust with a legal obligation to administer it solely for the purposes specified in the Trust.
A Trustor is the person who creates the Trust, while a Trustee is the person who manages the assets in the Trust.
Advanced Medical Directive
An Advanced Medical Directive is also known as an Advance Healthcare Directive. Advance Directives are designed to outline a person’s wishes and preferences in regards to medical treatments and interventions. When a patient is incapable of making their own medical decisions, a healthcare proxy can act on the patient’s behalf to make decisions consistent with and based upon the patient’s stated will.
A Beneficiary is the broadest sense is a natural person or other legal entity who received money or another asset from a benefactor in either a Will and/or Trust.
In a Conservatorship, a guardian or a protector is appointed by a judge to manage the financial affairs and/or daily life of another due to physical or mental limitations, or old age. A person under conservatorship is a “conservatee”, a term that can refer to an adult.
A legal guardian is a person who has the legal authority to care for the personal and property interests of another person, called a ward. Legal guardianship is one of the options available to parents who are planning for the care of their children in their absence due to a variety of situations, such as illness or incarceration. It allows parents to name a caregiver and to give the caregiver certain legal rights regarding the care of the children.
A decedent is a legal term used by professionals in the tax, estate planning, and law fields for a deceased person.
Estate planning is the process of anticipating and arranging, during a person’s life, for the management and disposal of that person’s estate during the person’s life, in the event the person becomes incapacitated and after death.
A person legally entitled to the assets and property of another after that person’s death, either through a Will and/or a Trust.
Power of Attorney
A power of attorney is a written authorization to represent or act on another’s behalf in private affairs, business, or some other legal matter.
Probate is the judicial process whereby a Will is “proved” in a court of law and accepted as a valid public document that is the true last testament of the deceased. It is also the legal process through which a deceased person’s estate is properly distributed to heirs and designated beneficiaries and the settlement of any debt owed to creditors.
A will is a legally enforceable document stating how you want your affairs handled and assets distributed after you die. It is an important component of estate planning.
A Living Will is a written statement detailing a person’s desires regarding their medical treatment in circumstances in which they are no longer able to express informed consent. A person’s Living Will can nominate someone to make medical decisions on their behalf.