Many people persist in the belief that an estate plan is something for wealthy, older people who have significant assets and want to control the distribution of those assets after their death. Nothing could be further from the truth. Anyone with a house, investments – or more importantly, children – needs an estate plan. And yet, thousands of people – including celebrities like Barry White and Amy Winehouse – die without an estate plan every day. The consequences of dying without an estate plan can be disastrous: Jimi Hendrix died without a will in September 1970, and the litigation that resulted dragged on for 30 years. In fact, while a will does not guarantee that one’s estate will avoid probate (in fact, it almost guarantees probate, but works to smooth and streamline the process; by contrast, a well-drafted trust will avoid probate), dying without a will is almost certain to guarantee some level of hurt feelings – at best.
Only slightly better is an estate plan that’s drafted and forgotten, never to be updated for subsequent events. The list of celebrities in this category reads like an all-star line up: Michael Crichton, Anna Nicole Smith, Paul Walker, Heath Ledger, James Gandolfini, Philip Seymour Hoffman. Each recognized the need for an estate plan, and drafted one. Unfortunately, their failure to regularly review and update that plan resulted in problems for each, usually centered around children, or the parent/guardian of a child.
- Crichton’s will excluded unborn children, unfortunate considering that his wife was pregnant when he died.
- Smith’s will left everything to her son, and nothing to her daughter, who was born after it was written. Problem was, at the time of her death, Smith’s son was already dead.
- Walker’s will made his mother the guardian of his daughter, and not her birth mother.
- Like Crichton, Ledger’s will omitted children – including his daughter, who was born some time before his untimely death.
- Gandolfini’s will left money to family members in a clunky way that resulted in a large tax bill, thereby reducing the amounts they inherited significantly.
- Hoffman’s will left money to an ex-girlfriend, and not his current girlfriend.
Having said all this, it’s not enough to simply consider what happens after death. What happens before death – as Casey Kasem’s experience has highlighted – can be equally important, if not more important.
Do you have an estate plan? Has your estate plan been updated in the last 5 years? Does your estate plan include an advanced healthcare directive? A financial directive?
If the answer to any of the above questions is ‘no,’ call us. We’ll help you draft a plan to meet your needs. And we’ll keep in touch, so that your estate plan reflects your wishes today, not your wishes five years ago.