An entrepreneur
An entrepreneur is a person who organizes and operates a business venture and assumes much of the associated risk. The risks associated with a business organization are suffered by the entrepreneur. Likewise, the profit from the business establishment goes to the entrepreneur.
What happens to your company or business establishment in the case of incapacitation of any sort? This is a question which requires a deliberate answer. Building a business from scratch could be a very tasking and tedious process involving patience, endurance, longsuffering, time investment, financial investment, etc. When you eventually attain that height in business which you have always dreamed of, or when you are close to achieving that height; what surety or assurance do you have that it won’t just come crashing to the ground in the case of incapacitation when you are not able to manage the business yourself? This should be a big concern for you as an entrepreneur.
Safety precautions of an entrepreneur
An eventuality which could render you incapable of making proper decisions for your business include, sudden sickness, a chronic ailment, an accident, advancement in age, death, etc. These factors could come suddenly without a prior notice or warning. When they occur and you are not prepared, it could mean the gradual or instant collapse of your business establishment.
To abolish this fear, you should consider setting up an effective security system which will cater for the wellbeing of your business and ensure its continuity in the event of incapacitation. A proper security system is making an estate plan. An estate plan gives you the opportunity to make necessary arrangements and provisions for your business organization if anything should happen to you.
In making an estate plan, there are some essential legal documents which an entrepreneur must consider including in his or her estate plan. They include:
- Last will and testament
- Living trust
- Financial power of attorney
Last will and testament
Your last will and testament is a simple but powerful legal document which contains your written intentions for your estate after your demise. The last will and testament is literally your last instructions regarding how your estate should be manage when you are no more. It conveys your intentions regarding your property distribution among your heir, instructions on how your creditors should be settled, instructions regarding your funeral rights, etc.
The type of will one chooses to adapt depends on the situation on ground. A standard will has to be in written form. It has to be signed by the testator in the presence of more than one witness. Some types of will include; oral will, holographic will, testamentary will, etc.
The testator usually appoints an executor. The executor has various responsibilities including, settling of debts, taxes, creditors, distribution of the testator’s properties among his heirs. The testator might name the executor as his spouse, parent, a relative, a probate layer, etc. In a situation whereby the testator does not know how to go about writing a will, he should consult a probate attorney.
Living trust
Having a living trust ensures your hard earned property goes to whomever you please in the case of death. At the event of your death, if you have no plans in place, your properties and business which you labored to acquire will have to go through the court system and they might end up in the hands of the wrong persons. Apart from the fact that your estate might end up in the hands of the wrong persons, accessing your estate might be difficult if you don’t have a living trust.
Financial power of attorney
Until you are involved in an accident and end up in a coma on a hospital bed, you make all the decisions regarding your finance. When this eventuality occurs and you don’t have plans on ground, your finance will suffer from poor decisions, inappropriate decisions, late decisions and these lags might lead to bankruptcy.
A financial power of attorney (FPOA) allows you to transfer your financial authority to someone else. This person bears the responsibility of making financial decisions on your behalf when you are no longer able to make these decisions for yourself. The person you appoint should be experienced in financial dealings.
As an entrepreneur, it is of utmost importance to include the above mentioned documents in your estate plan.
