The death of the renowned musician Prince at age 57 shocked the world. It also brought into focus for many of us the need for us to be mindful about our own estate planning. Not only was Prince’s death untimely and unexpected, it was the death of a celebrity with a substantial estate who died without a will.
The Ubiquitous Need for Estate Planning
Though most of us would assume that Prince, with all of his wealth and status, would have sought sound financial advice and proper estate planning, his situation is not as uncommon as it may seem. A recent survey by Rocket Lawyer showed that a whopping 64 percent of Americans don’t have wills.
His passing reminded us that it is not only the retired or elderly who should plan for the disposition of their assets after they’re gone. Some of us may still believe that wills are only essential if one has a sizable estate. This is not the case, however. Dying intestate (without a will) creates difficulties for those you leave behind, regardless of the size of your estate.
Where will Prince’s money go?
Because Prince’s parents were already deceased at the time of his death, and because Prince himself was unmarried and without children, his estimated $300 million estate will be divided among his closest relatives, one full sister and many half-siblings. His full sister has filed court documents to probate his estate and administer the distribution of his assets. Apparently, Prince did not have a good relationship with all of his half-siblings, but since he left no will, and according to law, they all stand to inherit considerable money.
Proper Estate Planning While You’re Thinking of It
No matter what your age, as long as you have accumulated assets, you should meet with an experienced estate planning attorney to ensure that your affairs are in order. The following are some examples of estate planning documents that you may wish to incorporate into your plan to ensure that your wishes are carried out:
- Durable power of attorney naming someone to make financial decisions if you become incapacitated
- Health Care Proxy, Living Will, or Advance Healthcare Directive naming someone to make health care decisions if you become incapacitated and setting forth your wishes
- Last Will and Testament stating how you would like your assets distributed and also designating a guardian for any children under the age of 18
- Living Trust to avoid court involvement (probate) and setting forth the distribution terms for the beneficiaries at your death
- Beneficiary forms to indicate who will receive your 401(k)s, IRAs, life insurance, etc.
- POD (payable on death) forms to indicate who will receive your bank accounts
Because not only death, but other changes, are inevitable and unpredictable, it is essential that your estate plan includes changes in your circumstances — such as marriage or divorce, births or deaths in the family, etc. Don’t forget that events that occur in your children’s, siblings’, or parents’ lives may also affect your estate plan.
In order to ensure that all your estate is in order, that you have considered all your options, and that the arrangements you make are legally binding and financially sound, you should consult with an experienced estate planning attorney.