Lessons on estate planning from great singers (but poor estate planners)

Estate planning is one of the most important things you can do for your family and loved ones. It helps make sure that your assets are distributed according to your wishes instead of distributed according to the government's plan. Putting your own plan in place can prevent a lot of heartache in the future. In fact, one of the most common things we hear from families we help is some version of: "I don't want to leave a mess for my family" or "I want to make things easy on the kids." Unfortunately, bad decisions can lead to an estate planning disaster. Having no estate plan, or a bad plan, can make the grieving process worse. If you think that the rich (and famous) have it easier than the rest of us when it comes to estate planning because of their money and access to advisors, that's not always the case. I actually started thinking about this recently when Pam and I were flying to a conference. I was looking for a movie to watch. I came across the new movie about Elvis which I had already seen and thoroughly enjoyed. That made me think of some of the other movies I've seen in recent years about musicians, and I wondered when there would be a movie about Prince's life. Then I remembered that his estate plan was being decided by the court system. Prince passed suddenly in 2016 at the age of 57. He had no spouse and no kids. He also had no will. Therefore, his estate worth more than $150 million was left up in the air. Not surprisingly, there was a court fight that lasted about six years. Minnesota law said that since Prince had no will, his nearest next of kin would receive his wealth. This meant everything went to his six half-brothers and half-sisters. Some of those individuals passed during the fight over his estate and their shares then went to their estates. Yikes! What a mess. It appears that the case has now been settled and various family members and companies that were formed by various family now own the rights to his music. Some of the family may have also sold their rights. I didn't dig hard enough to figure that out. However, one thing was clear: I'll probably have to wait a long while before I see any authorized movie about Prince. In the meantime, I can watch Purple Rain again, I guess. What are some of the lessons we can learn from Prince? Well, one is something we all know. The end can come at any time. In Prince's case, it was an accidental drug overdose. For some people, it is an accident. Or a stroke. Or a heart attack. We all know we should have a plan in place. If we don't take control and put our own plan in place, the state and court system will and that could be very slow and expensive. And ultimately, the distribution may not be what we would have chosen if we had done our own planning. While I was reading about Prince, I found out that Aretha Franklin also left a mess when she passed. She at least thought about her estate plan ahead of time and worked on it. The problem was she decided to take the do-it-yourself path. When she passed in 2018, her family initially thought she had no will. Without a will, her assets would have passed to her sons in equal shares. However, eventually, three handwritten documents were found at her house with various dates. One was found under a sofa cushion. The documents contained cross outs, notes, commentary about various people which wasn't always flattering, and contained what appeared to be her wishes concerning how her assets were to be distributed when she was gone. The handwriting was at times difficult to read. The documents were submitted to the court to determine which one, if any of them, was her will. Eventually, another document was found. This one was typed and said will on it and was done by an attorney. It was marked draft and was not signed. The different documents did not leave things to the same people in the same way. As a result, her estate was fought over for years. In fact, I can't tell if a complete settlement or ruling has yet occurred. What can we learn from Ms. Franklin's estate planning? It is important to have a clear and complete plan in place. Once a plan is completed, make sure it is stored in a safe and secure location. It is also important to make sure people know where to find your will when you are gone. By the way, Elvis, didn't do a great job with his estate plan either. While he did have a valid will, he named his dad as executor and trustee. However, his dad wasn't qualified to manage an estate as complex as Elvis' was. Further, his dad continued relying on advice from "Colonel" Parker. Many people believe that Parker, over the years, provided some bad advice to Elvis and charged too much for his help. What can we learn from Elvis' mistakes? Put the right people in place as executor and trustee. Make sure as executor or trustee, you are relying upon experts with integrity and who are providing good advice.