What Can Prince Teach Us about Estate Planning?

Shock and sadness over Prince’s recent death was quickly followed by a big question. As a Los Angeles Times oped headline asks and answers: “How could someone rich and famous like Prince die without a will? It’s not unusual. Just ask an estate lawyer.”

The article’s author Jack Osborn points out that Prince “didn’t amass a $250-million estate just through exceptional musical talent. He was also a shrewd businessman. Two years ago, Prince took control of his musical catalog and related copyrights, and negotiated a new contract with Warner Bros. His estate will reap at least $100 million on royalties alone over the next few years.”

Osborn also notes that Prince was “extremely hands-on with the business side of music. He shunned attorneys, preferring to deal directly with record studios and concert promoters, and made a point of controlling his legacy. It was part of his persona. Prince fought to remove his songs from YouTube and cut deals directly with digital music providers.”

Clearly Prince was an artist with very strong views and committed to working hard to achieve them. This only underscores the mystery of the non-existent will. This is particularly problematic because Prince died unmarried and without living parents. His surviving family members include a sister and five half-siblings who are expected to contest the will. Therefore, instead of choosing how his estate would-be distributed and supporting charities, Prince’s assets will be distributed without his guidance. Estate lawyers for his heirs will profit, as will Uncle Sam and the state of Minnesota when heirs pay the substantial estate taxes that could have been minimized with a basic estate plan that included charitable giving.

As Osborn notes, it is not unusual for the rich and famous to die without a will. He lists Jimi Hendrix, Pablo Picasso, Bob Marley, Howard Hughes, Sonny Bono and Abraham Lincoln as those without wills and mentions more than 55% of adult Americans do not have a will or estate plan. Only 41% of baby boomers (ages 55 to 64) have a will.

Why do so many individuals not have a will? One reason is that no one wants to think about their own mortality. And on top of that is the general procrastination many experience when dealing with any administrative task like renewing a driver’s license or paying bills. Plus, there are the added factors of needing to find an estate planning attorney who you trust and the cost involved. Yes, there are legal fees involved in preparing a will, but the cost of probate proceedings, estate taxes and attorney’s fees will end up costing Prince’s estate much, much more than it would have cost to prepare a will.

As for not wanting to think about one’s own mortality, most estate planning attorneys will also complete advance medical directives, powers of attorney, trust documents, etc. That is, in addition to distributing your wealth after your death, the documents the estate planning attorney will help execute can ensure that your wishes for health care are met during your life. You can also appoint someone to make your health care and financial decisions in the event of a permanent or short-term incapacitation. Again, this is not the most pleasant scenario to contemplate, but completing these documents ensures your care will progress in accordance with your wishes. And just as important, it frees your family members from having to guess what you would have wanted.

If you don’t have a will, make it a priority to get one. Ask your trusted financial advisor for the name of a qualified estate planning attorney and ask them to help hold you accountable to have your estate planning documents completed by a certain date.

As the Prince example shows us, dying without a will is expensive and complicates things for the loved ones you leave behind.

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