The Salesperson's Estate Planning Guide

Five Estate Planning Documents You Can't Live Without!

By: Hillel L. Presser, Esq., MBA

Erratic income is a common place for salespeople since most work on commission. That is why salespeople, especially, need to think ahead about planning their estate. It is always best to be proactive, than reactive!

This article details the most crucial estate planning documents that you should have drafted and an explanation of what each document does. With these tips, we hope to raise awareness of the importance of an estate plan since the third week of every October is Estate Planning Awareness week!

Just a few interesting facts about estate planning before I get into the essential documents.

• Estate planning is based on state law. Therefore, if you create an estate plan using the laws in one state – you may have to update your plan if you move to another state.
• Most estate planning documents must be notarized to become legally operative (unlike many other documents).
• If you don't create an estate plan, the laws of the state where you live will inevitably control who receives all of your assets.
• Proper planning can protect your children from creditors and lawsuits.
• You can bequeath some or all of your assets to a cherished charity.

Now that we know a little bit about estate planning, the following are five essential estate planning documents that every salesperson should have in place.

1. Last Will and Testament: The Last Will and Testament is the legal document that states where a person's assets should go upon their death. This document allows a person's estate to bypass any confusion as to who the beneficiaries are during the probate process (which would happen if a person were to pass away without a Last Will).
2. Living Will: This is not the same as the Last Will and Testament! A Living Will is a legal document that a person uses to make known his or her wishes regarding life prolonging medical treatments. It can also be referred to as an advance directive, health care directive, or a physician's directive.
3. Financial Power of Attorney: The Power of Attorney is granted to an "attorney-in-fact" or "agent" to give that individual the legal authority to make decisions for an incapacitated "principal" as to their financial matters. In some states this document is effective immediately and cannot be conditioned upon incapacity.
4. HIPAA Release: A HIPAA Release allows for access to your medical records. It is important for those individuals named in your other estate planning documents (such as the Power of Attorney) to have access to healthcare information in order to to deal with matters on your behalf at a time when you cannot do so.
5. Revocable Living Trust: A Revocable Living Trust is a type of trust that is designed to cover three phases of the Trustmaker's life: 1) while the Trustmaker is alive and well, 2) if the Trustmaker becomes mentally incapacitated, 3) and, after the Trustmaker dies. Assets funded into the name of the Trust during the Trustmaker's lifetime will avoid probate after the Trustmaker dies.

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