You’ve probably read the articles how the musician Prince, who recently passed, did not have a will. His estate is estimated to be around $300 million. That means that likely half of his wealth will go to the state. That’s $150 million if you’re counting. Not only that, but the remaining amount will be decided by a trustee that is appointed by the court who never even met the man and has never once had a conversation with him about how he wanted his estate settled. Ouch.
I continued to be amazed when I talk with people, including those with wealth, who tell me that it’s been years since they updated their will or worse, they don’t have one. Most of the reasons I get are, “We don’t really have enough money anyway for it to matter.” Or “I’ll get to it eventually. I just don’t want to think about it right now.” Or the best one, “Talking about it makes it more likely to happen sooner than later.” (Yes, people do believe this!)
When you don’t have a will and estate plan, all you are doing is making it very difficult for your heirs when you pass. It’s hard enough to deal with the passing of a loved one, but coupled at the same time with putting your descendants and heirs through the probate court system and trying best to figure out what your wishes are just adds more grief to misery.
Here are a few things you should must do today to make sure your wishes are honored when you pass.
1) Find your will and get it updated. Talk with us here at Parallel about it. We can help. There are excellent resources we can help you with that will ensure your will is up to date, accurate, and will actually do what you want it to do.
2) If you have significant assets, you need more than just a will. There are excellent, simple strategies to help you avoid probate court and potentially tax implications if you do some simple planning. Is there a cost for this. Typically. But it is so much better to pay some now, instead of a whole lot later. Again, talk to us and we can advise you on how best to proceed.
3) If you have children who are still at home and you are supporting, then let’s make sure you have sufficient life insurance in case you, or your spouse passes. There are some very inexpensive plans that will allow you to have peace of mind that financially you will be fine raising your children if something happens to your spouse.
Most importantly, start talking about this. If not with your heirs, then with your financial advisor. I’m amazed at how folks will avoid this topic like the plague, because they think that talking about it means it somehow speeds up the inevitability of their death. It is never too soon to start having the conversation.
I’m not sure why Prince never planned for his death. Was he superstitious about talking about it? Did he think he would live forever? Who knows? What I do know however is that no matter how difficult it is to accept our mortality, we all die. And unfortunately sometimes before we think we will. Let’s make sure that when we do, the only grief that is experienced is the loss of our life and not the financial and legal mess that could ensue.
Source: Brian Boughner, CFA, CMT