Celebrity fiascos are public learning opportunities, and these four celebrity estate planning debacles can show you how to not handle your estate plans.
Four Celebrity Estate Planning Fiascos
1. Pablo Picasso – Pablo Picasso died in 1973 with no estate plan at all. After he died, his six heirs fought for six years over who would get his assets. The lesson that you can learn is to create an estate plan and avoid lengthy and costly fights over your assets. This situation is perfectly avoidable, and you should create your estate plan and protect your loved ones.
2. Heath Ledger – Heath Leather suddenly passed away in 2008 at the age of 28. Fortunately, Health Ledger had a will. Unfortunately, he did not update his will after the birth of his daughter. Fortunately for Heath Ledger’s daughter, Heath’s family chose to include her in Heath’s inheritance, a decision that they did not have to make. The lesson that you can learn is to update your estate plan after a big life change, whether it be an event or a change in values. There was little reason for Heath to think that he was going to pass, and so he procrastinated changing his estate plan. You should keep your estate plan up-to-date with your life so that it correctly addresses your life after you pass. Your estate plan does not update itself.
3. Philip Seymour Hoffman – Actor Philip Seymour Hoffman wanted to avoid turning his children into “trust-fund babies.” While this can be a good desire, he made two mistakes. One, he gave all his estate to his girlfriend with the intent for her to take care of his children, but he did nothing to actually compel her to do so. Two, Hoffman did not do tax planning, and so his estate paid a massive tax. The lesson that you can learn is to use a trust: it can express your wishes on how to use your funds.
4. Tom Clancy – Author Tom Clancy passed away incredibly rich, but his estate plan was vague. His family was left to figure everything out on their own, which caused a lot of pain. The lesson you can learn is that the more complex your life, family dynamics, and assets are, the more complex your estate plan needs to be.
Regardless of your state in life, if you are a young adult or a seasoned adult you should know and remember some important things:
- You need an estate plan, no matter your age, wealth, or health. You should not procrastinate the decision to create an estate plan because you do not really know how much time you have to get everything in order.
- Update your estate plan to reflect life: marriage, new children, or death in the family. If you trust your heirs more or less or if you want to distribute your property changes, then you need to update your estate plan. Creating and maintaining an estate plan is something that you have to proactively do.
- A good estate plan can allow you to express your values and morals to your family and inform them of how you would like them to use the property that you leave them. You should give written instructions in your estate plan. Relying on verbal instructions-or no instructions at all-will almost certainly cause problems.
- If you have a lot of property, you need to work closely with your estate planning attorney to make sure that you are protected against all problems and you can fulfill your vision.
When you are ready to draft your estate plan, please contact The Rains Law Firm and we will work together to take care of yourself and your loved ones.