Three important things to remember about wills:
1. A will is a “naming document.” A will can name who will receive assets when the owner dies. A will can name an executor (or personal representative)-the person who will handle assets subject to the will, the debts. And, a will can name a guardian (for minor children).
2. A will impacts assets included in the “probate estate.” It has no impact on an asset for which a “probate-avoider” such as a beneficiary designation is in effect.
3. A will does not result in avoiding probate. In fact, wills are a central document in many probate proceedings.
A person who dies without a valid will is “intestate.” The intestate person has failed to name who will receive assets in his or her probate estate.
A revocable trust, often called a "living" trust". The owner of an asset, during the owner’s lifetime, completes the paperwork and transfers the asset to a new ownership (the trustee under the living trust.)
A living trust is also a “naming document”. It names who will receive assets owned by the trust. It also names a trustee (the person in charge of the assets) and successor trustees.
The primary reason to create a living trust is to avoid probate. Assets transferred before death to a living trust are removed from the probate estate.
For all practical purposes, in the United States the only insurance plan for long-term institutional care is Medicaid. Medicare only pays for approximately 2 percent of skilled nursing care in the United States. Private insurance pays for even less. The result is that most people pay out of their own pockets for long-term care until they become eligible for Medicaid. elder law medicaid planning attorney
Guardianship is a tool to be considered only when a person cannot because of age or mental limitations, make competent decisions regarding his/her own affairs. It is the most restrictive and intrusive form of surrogate decisionmaking. Guardianship is necessary when access to the individual’s assets is required (to pay for care or basic necessities) or healthcare and living decisions must be made. An individual, who has an appointed guardian, is called the ward.
Probate is the common term for the Court process to settle a deceased individual’s estate. The primary purpose is to resolve any debts of the deceased and to properly pass the deceased’s property to the rightful heirs.
Generally, all property owned solely by the deceased is required to pass through Probate. Property such as life insurance with a designated beneficiary, bank accounts that have paid-on-death designations, and some real estate that is jointly owned, passes outside of the Probate process.