What You Can Learn From the Estate Planning Mistakes of Others

There is much to be learned from the mistakes of others and the celebrity
world abounds with cautionary tales when it comes to estate planning. Even
with all the financial resources available to them, celebrities can neglect
the basics when it comes to protecting assets.

We come across sad tales all the time of “regular” people failing to take
the proper steps to create an estate plan that assures their assets pass
properly and that their heirs are spared from having to untangle costly
legal messes.

Here are five important lessons you can learn from the mistakes of others:

1. Don’t die without a will. Celebrities are the same as most people
when it comes to thinking they will live forever – but they differ greatly
in that they usually have a lot more money to leave behind. Actor Heath
Ledger died without updating his will to include his daughter; all his
assets went to his parents and siblings.

2. Equal isn’t always the same. Thinking she was treating her two
children equally in her bequest, one woman left her home to her son and her
investment portfolio to her daughter. Unfortunately, when she died, there
was a sizeable tax liability on the home, and the only assets available
were from the portfolio, leaving the daughter shortchanged.

3. Name the right executor. Naming a friend as executor is fine, but
not always the best option. One woman named her best friend as her
executor, but they happened to be the same age. When the woman died at age
86, her friend followed a few weeks later and no one was left to serve as
executor since she hadn’t named a backup.

4. Provide for your children from a prior marriage. A man with children
from a first marriage left all his assets to his second wife; when she
died, all of those assets went to her children, leaving nothing for his
children. Instead, he should have provided for them directly or placed his
assets in a trust so they could pass to his children after her death.

5. Promises don’t count. Before he died, Marlon Brando allegedly
promised his house to his caregiver but did not record that promise in his
will. She did not get the house. If you want to leave something to
someone, you need to put it in writing in your will or a trust.

For more information on protecting yourself and your family, call our
office to schedule a time for us to sit down and talk about a Family Wealth
Planning Session, where we can identify the best ways for you to ensure the
security of your loved ones.