Today marks the five-year anniversary of Michael Jackson’s death. Though the King of Pop left a huge mark on the music industry, with 13 Grammy awards and a record setting 26 American Music Awards, he will also be known in legal circles for the mistakes he made with his estate planning. As far as celebrities go, Jackson did more estate planning than most. He had a will and he also set up a living trust. However, Jackson failed to adequately fund the trust, meaning he did not transfer his assets into it. You can think of a trust like a safe. It doesn’t matter how great the safe is if you don’t put anything in it. The funding caused an issue for Jackson’s estate as it created ambiguity in ownership, allowing the usually private trust documents to become public record in probate court.
Since he is gone, Jackson will never have the chance to fix his mistakes and change his estate planning. You, however, are lucky. You don’t have to be a megastar like the King of Pop to benefit from estate planning, and looking at where Jackson went wrong, you can learn from his mistakes. When done properly, a will and living trust pair well together. As previously stated, a trust is a private document, but a will is not. Therefore, the use of a pour-over will can be used to maximize your privacy while assuring that all your assets make it into your trust. By making sure that your trust is properly funded with an assignment of property and a pour-over will, you will be able to avoid probate (in turn keeping your estate matters private) and provide asset protection to your beneficiaries.
Jackson’s trust mistake also led to the question of who owned the estate’s share of the business that owned many of The Beatles’ songs. If you own a business, business succession planning should be part of your estate plan. Through a combination of life insurance, business forms, and agreements, you can plan for exactly what happens to your business at your death and help to make sure that the business lives on after you are gone (or that your beneficiaries are compensated, depending on your goals.)
One thing Jackson did right that all estate plans with minor children should have is that he named a guardian. When you and your children are older, a guardian isn’t important, but it could change the life of a minor child. If you and your spouse were to die on the way back from a nice dinner or on your way to an anniversary trip, who would look after your children? This is a major reason why younger people should take the time to look into an estate plan now.
Michael Jackson is one of many celebrities who have made mistake planning mistakes, but you don’t have to follow them. Look at proper estate planning today.
For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 to schedule your free consultation.
It’s a Wild world. Are you protected? SM