A trust based estate plan includes the following documents:
Revocable TRUST
In a revocable Trust - sometimes called a living trust - you name a trustee to be in charge of wrapping up your financial affairs after you die and direct how you would like your property and assets to be distributed. The trustee can be a family member, a friend, or a professional fiduciary. In a Trust, you can also nominate a guardian to take care of your children and create separate trusts inside of your main Trust for your children.
A Trust is a legal document with instructions for the trustee. Think of the terms of the Trust like a bowl. Anything that is placed inside of the bowl must follow the instructions you create in your Trust. If you create a revocable Trust as part of your estate plan, you will then need to transfer your assets (with some exceptions) into the bowl. (If you don’t transfer any assets into the Trust, you will have an empty bowl.)
During your lifetime, you are the trustee and are in charge of the assets inside the bowl. The assets inside the bowl are owned by you as trustee of your revocable Trust. For a revocable Trust, you do not need to file a special tax return for any income earned on assets inside of the Trust.
If you become incapacitated, a successor trustee that you name will be in charge of managing the assets inside of the bowl. When you die, the successor trustee will be in charge of distributing the assets inside of the bowl to the beneficiaries you name in your Trust.
pourover
will
If you have a revocable Trust as part of your estate plan, you will also need what is called a pourover Will. A pourover Will is a very simple Will that catches anything that is accidentally left out of your revocable Trust and “pours” it back into the Trust.
ADVANCE DIRECTIVE for health care
In an Advance Directive for health care, you name a health care representative to be in charge of your health care in the event you are not able to make decisions for yourself. In your Advance Directive, you can give instructions and preferences about tube feeding and life support in end of life situations.
The State of Oregon has a form of Advance Directive that you can find here. (Please note that the Advance Directive form was updated on January 1, 2019. If you are completing your own Advance Directive, make sure you are using the most recent form.)
An Advance Directive is often confused with a POLST (Portable Orders for Life Sustaining Treatment), but these documents have different purposes. A POLST is a medical order that you fill out with your medical professional. Learn more about the differences between an Advance Directive and a POLST.
In a Durable Power of Attorney, you name an agent to be in charge of your finances in the event you become incapacitated and you are not able to manage them yourself. Your agent can be a family member, friend, or professional fiduciary. Your agent can step into your financial shoes and do all the things you can do.
DURABLE POWER OF ATTORNEY
In a Disposition of Remains Designation, you name an appointee to be in charge of your body after you pass away. You can give instructions about burial or cremation and indicate any other preferences.