Every now and then I will write a post about a celebrity who has passed away, and whether or not their Estate Plan was effective (if there was a plan in place at all). While the Estates of the rich and famous are significantly larger than most of my clients, the lessons that are learned from their mistakes are important to note.
This is not a complete list by any means; my hope is that by reviewing some mistakes that have been made in the past, they can be prevented for you and your estate.
We all know that eventually someone is going to have to deal with the issues concerning our funeral and/or memorial service; burial or cremation. As with other parts of estate planning, we have the ability to make things much easier on our loved ones by doing a little planning ahead of time.
When our office prepares an estate plan for a client, we provide them with a section in their estate planning binder to make their wishes known to their family. This includes notifying specific family members, friends, and organizations of the individual's passing. We also provide forms for our clients to set forth their personal information; sections for handling of remains and marker selection; casket or urn selection; information concerning a remembrance/funeral service; and information regarding costs and expenses.
Watch out for those estate planning attorneys! Linda Nell Lowney was an estate planning attorney for many years. In 2005 she became romantically involved with a client of hers, Thor Tollefsen.
Mr. Tollefsen was in his mid-eighties and 30 years older than Ms. Lowney, had emphysema and terminal cancer, and was using a walker when he married her in 2006. They married under a confidential marriage license that wrongly stated that the two were living together.
Shortly after they were married, Mr. Tollefsen complained to relatives that his wife was not taking care of him as she had promised to do and he began living in a senior care facility. When he died, his relatives discovered that Lowney had the remainder of the $340,000 that he had transferred to her less than 2 years earlier expecting that she would pay for his care with the money. Ms. Lowney had argued before the State Bar of California that she had been given the money as his girlfriend and not as his attorney.
I was reading an interesting blog on royalties and their value to estates after the death of the creator of the work.
The author, Peter J. Reilly, cited a recent Forbes list that indicated among other things that the JRR Tolkien estate is good for $7 million dollars annually. The blog focused on the J.D. Salinger estate and the steps that J.D. Salinger took to keep his writings from being exploited after his death.
After reading the blog, I Googled and found a video from a Forbes writer wherein she provided the amounts that the 5 largest celebrity estates earned from October 2011 until October 2012. I found that taking a look back at this list was very interesting, and worth sharing.
As I mentioned in a previous post, as a parent selecting a guardian for your children is one is the hardest steps in creating an Estate Plan. Even the thought of not being around to raise your children is enough to solidify the hesitation of creating an Estate Plan for many people.
Many parents begin planning for their child’s future even before they are born. An Estate Plan should be a facet of this planning. Because selecting a guardian can be overwhelming, I advise my clients to start small.
Make a list of traits that you want to have in a guardian, as well as a list of values that are important for you to pass on to your children. It also helps to rate the traits and values in terms of their importance to you. I recommend having each parent make his or her own list and then discuss them together.
People put off drafting their Estate Plans for a variety of reasons. Over the past twenty-five years in my Culver City office I have heard everything from “Estate Planning is only for the wealthy, not me” to “if I make a plan, I will die because the plan is already in place.” These and other Estate Planning misconceptions are for another post, for now I would like to focus on Estate Planning for parents.
One of the largest obstacles that keeps parents from meeting with an Estate Planning attorney is the issue of guardianship. As a parent choosing the best school, packing the perfect lunch, and checking for monsters under the bed are all standard, but entertaining the idea of who you would select to do these things if you could no longer do them is an emotional process. For anyone, thinking about the decisions that they would make for their loved ones after they have passed is difficult, in many respects this becomes even harder as a parent.
Almost every client asks me where they should keep their Estate Planning documents. And every time I explain that there is not a perfect answer. Historically, many people left the originals with the attorney who drafted the documents. I am not a proponent of that, and in fact retain only two client’s original documents. Both of those clients requested that I do so.
I think that one of the reasons some Estate Planning attorneys keep the original documents is because it insures that they would get future business from the client's family when the Trust was executed. I recommend that my clients keep their Living Trust; Wills and other Estate Planning documents in an easily accessible place. Moreover, I suggest that they inform their successor trustee/executor where they are kept.
For the most part, the results of our work are not seen by our clients. When we prepare an Estate Plan for someone, it is generally not implemented until the client’s incapacity or death.
What other professions is that true about? You go to the accountant or to the doctor, or to the dentist, or to the mechanic – well you get the picture – and you see the results fairly quickly. When you ask your friends for recommendations or read recommendations on the internet for those professions and most others, you are talking with people who have experienced the results of the work – not just the process of the work.
In my practice, this is important. I certainly do not want to be preparing Estate Planning documents for clients that are incompetent. By definition, someone who is incompetent cannot be signing a Trust, a Will, a Power of Attorney, an Advance Health Care Directive, or any other legal or Estate Planning document.
In California, our probate code sets forth the criteria to be used in determining whether someone is incompetent. (The probate code deals with a lot more than Wills and includes Living Trusts.) As an Attorney who prepares Estate Planning documents, it is important for me to be confident that the client is competent. This is true, because some day I might be required to give a deposition explaining why I believed the client was competent at the time of the documents execution.
Have you thought about that question? When a client comes to see me as there Estate Planning attorney about preparing an Estate Plan including a Living Trust, a Will, a Power of Attorney, Advance Health Care Directive, etc., it is something that I have started to ask about.
Honestly, I have not done anything myself yet. As many of us do, I have emails sent to me at four sites; I have financial records sent to me from a variety of sources – and they all require a password. I have business records and personal records all over the place. What about the fun things? Facebook? Linked In? or whatever follows?
For virtually every client that comes to my office to do Estate Planning including their Living Trust and Will, I prepare an Advance Health Care Directive. In the document, the client gives a power of attorney to someone to make medical decisions in the event that they are no longer able to make their own medical decisions. In another part of the document, the individual makes known his or her thoughts concerning life support.
Why does it seem like so many celebrities have issues with their Estate Planning?
The latest is B.B. King. The Estate of the late great blue’s legend is going to be paying some attorney’s fees. Obviously, when that happens, the beneficiaries of the Estate receive less.
King was the father to 15 children both natural and adopted. Eleven adult children survive. A group of them are alleging among other things that he had a more recent will than the one that has been tendered. They also allege that his business agent for 39 years should not be the executor of King’s Estate.
The children allege that the business manager moved more than one million dollars around; did not allow the family to see King during his final days; and caused him to have improper medical care. As one would expect, through his attorney all of these claims are denied!
So, you are reading this for a reason. Something has made you to start thinking about estate planning or you would not have found your way to this Blog Post.
Here are some of the more common Estate Planning mistakes:
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