Core Documents

A collection of strategies to help business owners keep more of their wealth.

Key numbers

Most people think of an estate plan as a will. A will is actually one of the less powerful tools in the kit. Without the other documents, a will alone leaves your family exposed in ways you probably haven't considered.

1. Revocable Living Trust

The trust is the engine of your estate plan. It holds your assets during your lifetime and distributes them to your beneficiaries at death — without going through probate court. You maintain full control as the trustee. You can change it at any time. Nothing is public. And assets transfer in weeks, not years.

The trust needs to be properly funded — which means retitling your accounts and real estate into the trust's name. A trust you never funded is just paper. This is a common and costly oversight.

2. Pour-Over Will

A pour-over will is a backup catch-all that directs any assets not already in your trust to “pour over” into it at death. You might forget to retitle an account, or you might acquire new assets late in life that weren't put into the trust. The pour-over will makes sure those assets end up in the trust and distributed according to your wishes — though they'll still go through probate first. It's an important failsafe, not a substitute for proper trust funding.

3. Durable Power of Attorney (Financial)

This document designates someone to make financial decisions on your behalf if you're alive but incapacitated — a serious illness, an accident, an extended recovery. Without it, your family may need to go to court to establish a conservatorship just to pay your bills or manage your accounts. With it, your designated agent can act immediately. Make sure the person you name is someone you trust completely with broad authority over your finances.

4. Advance Healthcare Directive

Also called a healthcare proxy or living will, this document designates someone to make medical decisions for you if you can't make them yourself, and specifies your wishes around end-of-life care. This is the most emotionally difficult document to complete — which is exactly why many people delay it indefinitely. Don't. The absence of this document puts your family in an impossible position and, in some cases, puts life-or-death decisions in front of a judge who doesn't know you.

5. HIPAA Authorization

The Health Insurance Portability and Accountability Act (HIPAA) restricts who can access your medical information. Without a signed HIPAA authorization, your spouse, adult children, or designated healthcare proxy may be unable to talk to your doctors, get test results, or coordinate your care — even in an emergency. It's a simple form. It takes fifteen minutes. Include it.

How they work together

These five documents work together as a system. The trust distributes your assets. The pour-over will catches anything missed. The DPOA covers finances if you're incapacitated. The healthcare directive covers medical decisions. The HIPAA authorization makes sure the right people can communicate when it matters.

The cost of getting all of this done right — a full plan from an estate planning attorney — is typically $2,500–$5,000. That's a fraction of a percent of what most people in this playbook's audience are protecting. Schedule the appointment.