They Definitely Have Lots of Fans
But not of their estate-planning mistakes
Actors, recording artists, politicians, authors and the like. They’re rich and famous — and envied by many. But they often make big mistakes when it comes to estate planning. You’re not going to be on a magazine cover like them, but might you be making any of their mistakes?
Celebrities are no different than anyone else when it comes to making common, avoidable planning errors, such as failure to prepare wills or trusts with specific language as to gifts and wishes. Every day across the country, people from all walks of life make such mistakes. The only difference is the dollar amounts involved.
High-profile errors are good examples of how not to address retirement and estate planning matters, say Danielle and Andrew Mayoras, authors of Trial & Heirs: Famous Fortune Fights! Here are some of the celebrity mistakes they describe:
Singer-politician Sonny Bono died without a will or trust; an alleged love child sought part of his estate.
Princess Di’s “letter of wishes” wasn’t specific about the gifts she wanted for her 17 godchildren, so the letter was largely ignored.
Jimi Hendrix died without a will. His estate went to his father, while a brother who was reportedly close to him got almost nothing.
Marlon Brando’s estate is still embroiled in 26 lawsuits. Claims include a forged will and verbal promises not in writing.
Heath Ledger didn’t update his will after the birth of his daughter. Questions abound as to whether other heirs will pay for her care and education.
Michael Jackson’s estate has been beset with legal controversy since his death two years ago, including a $17.5 million lawsuit over insurance.
You can work and invest wisely all your life, but if you don’t obtain a proper estate plan, your heirs might lose some or all of their inheritance or find themselves trying to protect it amid lengthy and expensive court battles.
“People think if they don’t have a fortune it’s not worth the effort, but regular people make the same mistakes that some celebrities make,” says Andrew Mayoras. “Family fights often erupt, whether it’s over $100,000 or $10 million.”
Of course, not all celebrities make estate-planning errors. Some take care of business, showing the rest of us that it pays to do so.
For example, there’s recording star Amy Winehouse, who died recently at age 27. Her supporters feared that her estate — valued between $15 million and $30 million — might go to her ex-husband who went to prison for burglary and has been blamed for introducing her to hard drugs.
Turns out that didn’t happen. The U.K.’s Daily Mail newspaper reported that Winehouse updated her estate plan after her 2009 divorce, making sure her family — and not her ex — would inherit her fortune. The article says her exhusband gets nothing and that her money will be divided among her mother, father and older brother.
A “close friend” quoted in the article said she is confident that Winehouse took care of her affairs and made sure her assets and legacy would transfer according to her wishes.
If you haven’t started an estate plan — or if your plan needs updating — talk to your financial advisor and estate attorney. If you don’t have an estate attorney, we can recommend one to you.