Putting off making estate plans is common. However, it is also not wise. You won't know about the legal battles, tax bills, financial chaos and family stress. However, your family will. Learning from the mistakes made by famous people provides good lessons, says a recent article from CNBC, “3 end-of-life money mistakes celebrities have made—and how you can avoid them.”
Aaron Carter was very young when he died without a will, leaving behind an 11-month-old son and a fiancée. In California, the court designates the child as the sole heir when an unmarried person dies without a Will. However, Carter’s son was a minor, and minors may not legally inherit assets. In this case, the court appointed a fiduciary to manage the estate.
A better way: have an estate plan created, even if it’s just a basic Will. Parents of minor children should have a Will to name a guardian, unless they want the court to appoint a guardian. An estate plan could also be used to care for a loved one if you aren’t married.
Another problem is created when there’s money but no estate plan. Few people want an 18-year-old child to inherit large amounts of money with no guardrails in place. A trust is an excellent way of setting terms and conditions on an inheritance, whether the parent is living or has died.
Kobe Bryant is an example of what happens when you don’t update an estate plan. When he died, he did have an estate plan. However, it hadn’t been updated to reflect the birth of his child, Capri. As a result, she wasn’t legally a beneficiary of his estate. His widow had to go to court to petition to have the daughter added to the trust.
Had the trust been updated, his widow would not have had to go through this process in the public eye.
Your estate plan needs to be updated when new family members are welcomed. The same is true for any big life event like marriage, divorce, death, or a major financial change. Estate planning documents need to reflect the changes in your life.
James Gandolfini offers a harsh lesson in how estate planning is needed to prevent an estate from being decimated by taxes. Gandolfini had taken the time to create a Will. However, no tax planning was done for his estate. His $70 million estate paid an estimated $30 million in federal and state estate taxes before making distributions to friends and relatives.
An experienced estate planning attorney will be able to review your situation and determine which strategies will work best to protect your estate and your family. Everyone needs to have an estate plan, no matter the size of your estate or how many people recognize you when you walk down the street.
Reference: CNBC (April 20, 2025) “3 end-of-life money mistakes celebrities have made—and how you can avoid them”
Free E-Newsletter – Subscribe Now
