Financial Word of the Day: Living Will

Larry Jones
Jun 30, 2025
2 min read

Updated: Sep 26, 2025

Let’s talk about a document that has nothing to do with leaving your money behind—but everything to do with how you want to live if life takes an unexpected turn.

Definition of a Living Will

A living will is a legal document that outlines your preferences for medical treatment in the event you become incapacitated and can’t communicate your wishes yourself.

Think of it like a medical game plan. If you can’t speak for yourself—whether due to coma, stroke, or a major health event—this document does the talking. It tells your doctors (and your loved ones) exactly what kind of care you want—or don’t want—such as life support, resuscitation, feeding tubes, or pain management.

This is not the same as a last will and testament (which kicks in after you pass away). A living will is for while you’re still alive but unable to advocate for yourself.

Why It Matters Financially

When medical decisions are left unclear, families often face high-stakes choices in emotionally intense moments—and costs can skyrocket quickly.

A living will can:

Prevent expensive, unwanted treatments.
Avoid legal battles over who gets to decide what.
Minimize emotional stress and confusion for your loved ones.
Keep your finances aligned with your values.

In short: it protects your dignity and your wallet.

Real-World Example

Imagine this conversation:

"Hey, did you hear about Mark? He’s been in the hospital on life support for two weeks. His family’s torn on what to do. They didn’t know what he wanted."

"That’s rough. I actually set up a living will last year for situations like that. Everything’s spelled out, so my family isn’t left guessing."

That’s the power of a living will—it helps you take control now so others don’t have to wrestle with hard decisions later.

Pro Tip: Pair It with a Health Care Proxy

A living will is often part of a bigger toolkit called an Advance Directive. It’s smart to also assign a health care proxy (a person you trust to carry out your wishes if you’re unable to speak for yourself). They work hand-in-hand.

Action Step for Today

If you don’t have a living will, make it a priority. Most states have simple forms you can fill out yourself, or you can go through an estate planning attorney to make it airtight. Either way, it’s worth the peace of mind—for you and your family.

Bottom Line:

A living will isn’t about being morbid. It’s about being mature, prepared, and financially smart. Because the best financial decisions are often the ones that protect your money, your family, and your peace—before life gets messy.