How can one reconcile the act of the truthful (Siddiq) when he donates all his wealth, with the Hadith: "It is better that you leave them self-sufficient"? And which is better?

Donating all one's wealth is permissible for someone who has a source of income or is confident in their ability to endure, persevere, and refrain from begging. However, if these conditions are not met, donating all wealth is makruh (disliked). And if the donation affects the financial sufficiency of those whose upkeep is obligatory upon him, then he is committing a sin.

As for a will (wasiyya) that exceeds one-third of the estate, it is forbidden if the testator has heirs. This is because the Prophet, peace and blessings be upon him, said: "A third, and a third is much. Indeed, that you leave your heirs wealthy is better than that you leave them poor, begging from people." This forbidden will is valid and enforceable if the heirs approve it.

The difference between charity (sadaqa) and a will (wasiyya) lies in the fact that the person giving charity may earn other wealth for his heirs, whereas the person who wills away all his wealth leaves his heirs with nothing, or harms them if he wills away more than one-third.