When It Comes to Estate Planning, Learn From the Mistakes of Others

8:42 pm Estate Planning

Oops 150x122 When It Comes to Estate Planning, Learn From the Mistakes of OthersThere is much to be learned from the mistakes of others and the celebrity world abounds with cautionary tales when it comes to estate planning.  An article last week in the Globe and Mail lists these 5 important lessons:

1.  Don’t die without a will.  Celebrities are the same as most people when it comes to thinking they will live forever – but they differ greatly in that they usually have a lot more money to leave behind.  Actor Heath Ledger died without updating his will to include his daughter; all his assets went to his parents and siblings.

2.  Equal isn’t always the same.  Thinking she was treating her two children equally in her bequest, one woman left her home to her son and her investment portfolio to her daughter.  Unfortunately, when she died, there was a sizable tax liability on the home, and the only assets available were from the portfolio, leaving the daughter shortchanged.

3.  Name the right executor.  Naming a friend as executor is fine, but sometimes not the best option.  One woman named her best friend as her executor, but they happened to be the same age.  When the woman died at age 86, her friend followed a few weeks later and no one was left to serve as executor since she hadn’t named a backup.

4.  Provide for your children from a prior marriage.  A man with children from a first marriage left all his assets to his second wife; when she died, all of those assets went to her children, leaving nothing for his children.  Instead, he should have provided for them directly or placed his assets in a spousal trust so they could pass to his children after the second wife’s death.

5.  Promises don’t count.  Before he died, Marlon Brando promised his house to his caregiver but did not record that promise in his will.  She did not get the house.  If you want to leave something to someone, you need to put it in writing in your will or a trust.

To avoid mistakes like these with your estate planning, contact our Newport Beach law firm.

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