Who Needs An Estate Plan?
July 16, 2009
The recent unveiling of Michael Jackson’s will has brought up a lot of questions about wills, trusts, and estate planning: Why is his will so short? Does this mean it doesn’t work? Where is all his money going?
And then there’s the statement that makes any estate planning attorney shudder:
I guess trusts and estate plans are just for the rich.
Nothing could be further from the truth. Trusts and estate plans are for everybody. First of all, an estate plan describes the documents that dispose of your assets after you are gone. This may include nothing but a will and a healthcare directive, or it may include those documents plus a living trust, powers of attorney, modified beneficiary designations on insurance policies, retirement plans, annuities, and more. The size and intricacy of your estate plan can be as small or as large as you wish. It all depends on you and your attorney.
Secondly, revocable living trusts are useful to everybody, from the asset-poor young parents just starting out to the wealthy grandmother with enough property to give a house to every grandchild. This is because revocable living trusts are private and versatile documents that can be created to accommodate your unique situation, whatever it may be.
Those asset-poor young parents like the privacy of a trust–the fact that they can nominate a trustee to take charge of their finances for their minor children without everybody knowing who it is. They can also use a trust to set money aside for their children’s college fund, if that is important to them; or keep the family money in a singe trust for the benefit of all their children until each one has reached a certain age, when the inheritance can be divided up equally. And they can do this even if their only asset is the small house they just bought, or possibly a low-cost term insurance policy.
The wealthy grandmother likes a trust because she can leave an inheritance to her daughter, but keep it out of the hands of her daughter’s untrustworthy husband; or she can set aside a sum of money for each grandchild, to be used specifically for education, not fast cars. And the trust can encompass as many bank accounts, investments, or pieces of real estate as she likes.
Trusts and estate plans are essential and useful tools, not just for the rich and famous, but for everybody. Contact our office to find out what kind of estate plan can benefit your family.
Michael Jackson’s Will Answers Few Questions
July 7, 2009
The past week has been filled with media speculation about Michael Jackson and his will: Did he have one and what might be in it? Well the waiting is finally over… kind of. It turns out Michael Jackson did create a will, which was submitted to the California probate courts earlier this week. The will (which can be viewed here) is five pages long, and because it pours “my entire estate” into the Michael Jackson Family Trust, the will itself reveals very little about the specifics Jackson’s estate or his instructions regarding the administration of it.
A will, although it can remain private during your lifetime, becomes a matter of public record once it is submitted to the probate courts after your death. But a trust is a private document, and in most cases remains private even after your death.
Jackson’s will does reveal a few details, though, namely who he chose as guardian for his children. In paragraph 8 of his will, on page 4, just above his signature, Jackson states:
“If any of my children are minors at the time of my death, I nominate my mother, KATHERINE JACKSON as guardian of the persons and estates of such minor children. If KATHERINE JACKSON fails to survive me, or is unable or unwilling to act as guardian, I nominate DIANA ROSS as guardian of the persons and estates of such minor children.”
Whether Jackson’s wishes for guardianship will be followed remains to be seen. As Jackson’s ex-wife and mother of his two oldest children, Deborah Rowe would normally automatically be awarded custody. However, there are still too many unanswered questions about the status of Rowe’s parental rights—and her desire to assert those rights—to make any claims for certain.
The one thing that is certain, however, is that whatever odd and inexplicable things Jackson may have done during his life, he seems to have done what he should to provide for his family’s financial needs and their privacy after his death.
Have you done the same?
Michael Jackson’s Death Leaves A Legacy of Questions
June 27, 2009
Michael Jackson’s death on Thursday shocked the world. As fans and mourners line up to pay their respects (and snap up Jackson music and merchandise) the question now on the minds of many is: What will happen to Michael Jackson’s estate and to his children?
It is still too early to know what legal steps Jackson may have taken to handle his estate and protect his three young children. But the truth is that even if Jackson does have all the requisite estate planning documents in place, execution of his wishes is not likely to be simple. According to this article in the associated press Jackson was deep in debt at the time of his death—so much so that one source wonders, “[will there be] anything left after you pay off the debts?”
But the more immediate question for many people—especially parents—is what will happen to Jackson’s children? Jackson had full custody of his three children (two by ex-wife Debbie Rowe and one by a surrogate mother, both of whom gave up their custodial rights), and although no guardianship documents have yet been revealed, according to news sources “it was Jackson’s intention for his children to pass to his mother, Katherine,” should anything ever happen to him. However, rumors that Rowe plans to battle for custody, and that his 79 year old mother may be in poor health, promise that this too is not likely to be a straightforward process.
It seems that the days of simple wills are a thing of the past. Even for your average Joe, blended families, shared assets, managed debt and the need to provide care arrangements for dependents, make the execution of an estate plan more convoluted than ever. Does this mean we shouldn’t even try? Quite the contrary. It means that it’s more important than ever to document your wishes for your children, family and estate, and to update these plans as your family circumstances change.
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