- Asset Protection Planning
- Business Succession Planning
- Charitable Giving
- Disability and Special Needs
- Elder Law
- Executor and Trustee Responsibilities
- Financial Powers of Attorney
- Inheritance Planning
- Lifetime Gifts
- Medical Directives
- Planning for Minors
- Retirement Accounts
Why Do I Need an Estate Plan?
Celebrities often teach us great lessons on what not to do, and estate planning is no exception. While some stars such as Elvis Presley have preserved their legacies impeccably, others have cost their heirs millions of dollars and caused untold headaches.
Here are some lessons we can learn from some of the biggest stars in music, Hollywood, and pop culture.
Lesson 1: Have a Will
Prince is a prime example of the chaos that can ensue when you do not have an estate plan in place. The purple-clad music legend died without a wife or children . . . or a will. “Relatives” came out of the woodwork, claiming to be Prince’s children, siblings, and wives. The probate court ultimately divided his estate among his sister and five half-siblings.
Billionaire aviator Howard Hughes wanted to use his wealth to advance medical research, but his intentions were not realized because he did not put his wishes down on paper. A will later turned up at a church in Utah, but it turned out to be a forgery. While Hughes’ aviation company was sold to General Motors for $5 billion, his remaining $2.5 billion estate went through a thirty-four-year battle before it was finally divided among his twenty-two cousins.
Even young adults need to have a will in place. Jimi Hendrix did not think he would die at age twenty-seven. His estate went to his father, who later left it to Jimi’s sister. That did not stop Jimi’s brother from battling for a portion of Jimi’s legacy.
Another music immortal, Bob Marley, knew that his body was mortal as he battled cancer. Still, he did not draft a will, because he thought it was too much of a worldly concern. When the reggae icon died, hundreds of people claiming to be his children stepped forward to claim a piece of his fortune. The Jamaican Supreme Court finally settled the estate in 1991 with Marley’s wife and eleven legal children.
Singer and congressman Sonny Bono did not have a will when he died in a skiing accident. His fourth wife, Mary Bono, who filled Sonny’s seat in the House of Representatives, had to defend his estate against several lawsuits. One of them came from Cher, Sonny’s singing partner and second wife. A so-called love child also entered the fray but retreated when he was asked to support his claims with DNA evidence.
Lesson 2: Keep Your Will Updated
James Brown seemed to have his affairs in order. His will took care of six adult children and some grandkids. He also designated his musical empire to fund the I Feel Good Trust for poor children in Georgia and South Carolina. However, the Godfather of Soul did not update his will to include his youngest child, James Brown Jr. The boy’s mother contested the will, leading to legal action by five of Brown’s other children. A settlement seemed to put the issue to rest, but the South Carolina Supreme Court invalidated it, allowing the dispute to continue.
A similar situation happened to Jurassic Park author Michael Crichton. He did not expect to die while his wife was pregnant, and his will did not include his unborn child. This required some legal gymnastics to resolve the situation.
Lesson 3: Avoid Excessive Taxation
James Gandolfini left us with a timeless performance on The Sopranos, but he also left us with a cautionary tale of what not to do when making an estate plan. He had noble plans: give some money to friends and relatives, leave some Italian property to his children, and give 80 percent of the remaining estate to his sisters and baby daughter. However, Gandolfini only gave 20 percent of this amount directly to his wife—he missed out on taking advantage of the marital deduction and allowed the Internal Revenue Service to take a massive $30 million bite out of his estate.
Lesson 4: Choose the Right Executor
Michael Jackson did not fully fund his trust and named nonfamily members as his executors. They did a fantastic job, earning $2 billion for the estate after his death, though $500 million was owed in debt and taxes. The King of Pop also updated his will after the births of Michael Jr. (aka Prince), Paris-Michael, and Prince Michael II (formerly Blanket, now known as Bigi).
On the other hand, energy and tobacco heiress Doris Duke chose her butler to make sure her $1 billion fortune was distributed to charity. He lacked the qualifications for the task, to say the least. The estate fell into disarray, and the Duke Foundation eventually made the ironic decision to demolish the New Jersey mansion where Duke spent her childhood.
Lesson 5: Get Family on the Same Page
If your family members do not get along, the situation will only get worse after you are gone. Tom Petty’s wife and daughters from a previous marriage could not even agree on the meaning of the word equal. Fortunately, Petty’s family worked out their differences and agreed on the formation of Tom Petty Legacy LLC to manage his estate.
The family of legendary disc jockey Casey Kasem did not have such a happy ending. His second wife, Jean, did not get along with his older children before or after his death. Jean prevented the children from visiting Casey while he was alive. They staged a public demonstration outside the home, and Jean threw raw, frozen meat at his daughter Kerri. After Casey died, his children wanted his body to be buried in California, but Jean had it shipped to Montreal and later had him buried in Norway.
Lesson 6: Keep Things Private
Even if the family is singing from the same choir book, the lack of a will can make the estate administration process a public proceeding in probate court. That happened to the family of Aretha Franklin. The Queen of Soul’s lack of an estate plan set her $80 million estate up for public scrutiny and a large tax bill.
Movie star Burt Reynolds had it partially right. His will also became public, but nobody knows what he left to his son with Loni Anderson because he handled it with a private trust.
Lesson 7: Clarify Your Marital Status
Most of us have a good idea of whether we are married or single, but you would be surprised at how often celebrities get this issue confused.
Frank Sinatra Jr. and his ex-wife, Cynthia, continued to live together after their divorce, leading her to claim that they had a common law marriage. Sinatra disagreed, claiming the two were close, but not married. A Texas judge ultimately granted Cynthia a second divorce from Sinatra, but an appeals court later overturned the decision after Sinatra had died, concluding they had not remarried and citing all of the times they had stated that they were single.
Talk-show host Larry King had a rocky seventh marriage to Shawn Southwick. He had filed for divorce, but it was not finalized when he died. She ended up reaching a settlement with his son Larry King Jr. over his $144 million estate.
Your estate plan will most likely not be as complicated as a celebrity’s, but it is important that everyone consult an estate planning attorney to keep the peace and ensure that your wishes are followed.