Estate Planning For The Rich and Famous
When was the last time you looked at your estate plan? Any guilty faces out there? If you are a normal busy person – probably not often enough! The estate planning of the rich and famous is spilt in ink across the gossip pages with salacious detail. We can learn much from the mistakes of others.
Privacy – first flaw in an estate plan where you require privacy is having a simple will. This document is public record. A fun reading is Herb Nass’s book “Wills of the Rich and Famous”. It is fascinating to read what and who was important to cultural icons like Frank Sinatra, Elvis and many others. To protect the secrets of your legacy from prying eyes you need to have a Revocable Trust rather than a simple will. The terms of these trusts are not public. Often used by farmers, who live seemingly simply by outsiders, but who pass on vast land wealth through their estates.
Current – are the terms in your documents current? When Philip Seymour Hoffman died he had not named the last two children in his will. Every state’s laws on estate planning are different. Anna Nicole Smith left her estate to her son, who had actually predeceased her and then specifically excluded spouses and future heirs. When the terms of the will are not clear it takes time to get these through probate court and can encourage more legal challenges.
Beneficiary designations – unknown to many, retirement accounts (401k, IRA, 403bs etc.) and life insurance passes by ‘contract’. What that means is that whatever the beneficiary designation says on the account or the policy trumps the language in your will. For example, if you have left an ex spouse named as the beneficiary of your 401k, this is the law, even if you updated your will to name the new spouse.
Personalize – take the time to make your estate planning personal to you. The danger of using standard forms is that much does not apply to your situation nor the state you reside in. Your will and trust can be personalized – it is not like a mortgage contract – the more detail you enter the easier it is for your heirs to understand your wishes.
Bottom line – dust off that old will in your files and review those beneficiary designations. You might be surprised how much has changed. As always give us a call if you have any questions about your personal situation. (612) 455 6900