ADVERTISING: ADVERTORIAL - Why do people confuse wills, trusts and powers of attorney?

As an Idaho estate planning attorney, I've noticed a consistent pattern during initial consultations: clients frequently mix up wills, trusts, and powers of attorney. They'll ask if their will can help them if they become incapacitated, or wonder if a power of attorney distributes their assets after death. These aren't silly questions — they're completely understandable given how these documents are often discussed together. 

Let me explain why this confusion happens and clarify what each document actually does. 

They're All Part of the Same Conversation 

The main reason people confuse these documents is that estate planning attorneys typically discuss them as a package. When you meet with an attorney about planning your estate, you'll usually hear about all three tools in the same appointment. This creates the impression that they're interchangeable or overlapping, when in reality, they serve distinct purposes. 

Think of it this way: just because your doctor discusses diet, exercise, and medication in the same wellness visit doesn't mean these interventions do the same thing. Similarly, wills, trusts, and powers of attorney work together as part of a comprehensive plan, but each has its own specific job. 

The Timing Distinction That Matters Most 

The biggest source of confusion is about when these documents take effect. A will only becomes operative after you die. It cannot help you during your lifetime, no matter what happens. Meanwhile, powers of attorney only work while you're alive and become void the moment you pass away. Trusts can function both during your life and after your death, depending on how they're structured. Most trusts used in estate planning will serve a purpose both while you are alive and after your death. 

Many clients assume their will covers everything, but if you become incapacitated without a power of attorney in place, your family may need to petition an Idaho court for a conservatorship or guardianship — even if you have a perfectly valid will waiting in your filing cabinet. Wills only direct what happens after your death — they do nothing if you are alive and incapable of making your own decisions. That is what powers of attorney are for.  

Probate Adds to the Confusion 

In Idaho, many wills must go through probate court to take effect, while properly funded trusts generally avoid the need for probate. When clients hear this, they sometimes conclude that trusts are simply "better wills." But trusts aren't upgraded versions of wills — they're different tools altogether.  

A will is a set of instructions for the probate court about who should receive your assets and who should manage your estate. A revocable living trust, on the other hand, is a legal entity that can own your assets during your lifetime and distribute them after your death without court involvement — making probate unnecessary. Most people with trusts still have a "pour-over will" as a safety net for any assets accidentally not transferred into the trust. This is the type of redundancy planning that a good estate planning attorney will insist on for their clients.  

Powers of Attorney Sound More Limited Than They Are 

The term "power of attorney" sounds narrow and technical, which leads people to underestimate its importance. Some clients think it's just for specific tasks, like allowing someone to sign documents while they're out of town. 

In reality, a durable power of attorney is one of the most critical documents in your estate plan. It designates someone to manage your financial affairs if you become unable to do so yourself. Without one, your loved ones cannot access your personal bank accounts, pay your bills, or manage your property during your incapacity — regardless of what your will or trust says. 

Idaho law does provide some limited authority for family members to access certain accounts for incapacitated individuals, but these provisions are far more restrictive than a well-drafted power of attorney.  

The Medical versus Financial Split 

Adding to the confusion, Idaho uses different documents for medical and financial decision-making during incapacity. Your durable power of attorney handles financial matters, while a healthcare power of attorney (or medical power of attorney) addresses medical decisions. Clients often assume one document covers both areas, which isn't the case. In addition, you can also put in place advanced medical directives like living wills and POST forms (Idaho’s version of a DNR form), which adds options, but also complexity to the overall picture.  

Moving Forward with Clarity 

Understanding these distinctions is the first step toward creating an effective estate plan. A comprehensive Idaho estate plan typically includes a will or trust, a durable power of attorney for finances, and a healthcare power of attorney for medical decisions. 

Rather than trying to choose between these documents, think about how they work together: your will or trust distributes your assets after death, while your powers of attorney protect you during life. Each fills a gap the others cannot. 

If you're still uncertain about which documents you need, that's exactly why estate planning attorneys exist. We can assess your specific situation and recommend the combination of tools that will protect you and your family most effectively.  

My law firm is currently offering free telephonic, electronic, or in-person consultations concerning adult guardianships, probates, and creating or reviewing estate planning documents.   

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Robert J. Green is an Estate Planning, Probate, Elder Law, Trust, & Guardianship Attorney and the owner of Kootenai Law Group, PLLC in Coeur d’Alene. If you have questions about estate planning, probates, wills, trusts, powers of attorney, guardianships, Medicaid planning, or VA Benefit planning, contact Kootenai Law at 208-765-6555, [email protected], or visit www.KootenaiLaw.com.  

This has been presented as general information and not as legal advice. Do not engage in legal decision-making without the advice of a competent attorney after discussion of your specific circumstances.