Estate Planning Mistakes of the Rich and Famous
In the spirit of our Wills & Executor 101 evening coming up on Wed April 27th, I thought I would share a few stories from Estate Planning Mistake of the Rich and the Famous.
Michael Crichton, best-selling author did leave a will but it excluded any unborn children. This is a typical provision in a will for a high-net-worth man. (Although, in an odd twist, Anna Nicole Smith used the same provision and specifically excluded “future children” from her will, leaving her estate to her recently deceased son and disinheriting her 5-month-old daughter. A judge eventually straightened that out-but at an expense to the estate.)
When Crichton died of throat cancer,
His fifth wife was six months pregnant and his will disinherited that child. This illustrates the importance of updating a will.
Also important, updating should be done in the will or trust document itself rather than in a letter of wishes. Although some defend the validity of accompanying letters, the case of Princess Diana shows. Why they might not be the strongest tool in the estate planning shed.
After Princess Di died in a car crash on Aug. 31, 1997. A letter of wishes was discovered in her estate planning documents that called for a quarter of her personal possessions to be distributed to her 17 godchildren, at the executors’ discretion. The executors, Diana’s mother and sister, instead gave each godchild a trinket to remember Diana by. And had the letter thrown out in court through what some said was a legal loophole. The judge decided that the executors’ discretion meant they were not obligated to give the godchildren anything. The portion of the estate each child would have received under the terms of the letter reportedly would have been valued at more than $150,000.
The point from this is that your intent needs to be incorporated into your will or trust and not placed into a separate document.
Please contact me if you need to discuss your estate planning or need to update your will. I can put you in touch with an appropriate professional.