Aretha Franklin, heralded as the “Queen of Soul,” died from pancreatic cancer at age 76 on August 16th at her home in Detroit. Like Prince (another greatest musicians of all time, who died in 2016), Franklin died without a Will or Trust to pass on her multimillion-dollar estate. Her lack of estate planning was a mistake that will undoubtedly lead to lengthy court battles and major expenses for her family.
A common mistake
Such lack of estate planning is common. A 2017 poll by the senior-care referral service, Caring.com, revealed that more than 60 percent of U.S. adults currently do not have a will or trust in place. The most common excuse given for not creating these documents was simply “not getting around to it.” Whether or not Franklin’s case involved similar procrastination is unclear, but what is clear is that her estimated $80-million estate will now have to go through the often lengthy court process known as probate, her assets will be made public, and there could be a big battle brewing for her family.
Because Franklin was unmarried and died without a will, Michigan law (similar to Hawaii) stipulates that her assets are to be equally divided among her four adult children, one of whom has special needs and will need financial support for the rest of his life. It’s likely that caregivers for her son will need to decide whether to accept the inheritance coming to him and lose all governmental support he may’ve been able to receive, or they may have to disclaim all of the inheritance from his mother’s estate. It’s also possible that probate proceedings could last for years due to the size of her estate. And all court proceedings will be public, including any disputes that arise along the way.
Contentious Court Disputes
Such contentious court disputes are common with famous musicians. In Prince’s case, his estate has been subject to numerous family disputes since he died two years ago, and that even led to the revocation of a multimillion-dollar music contract. The same thing could happen to Franklin’s estate, as high-profile performers often have complex assets, like music rights. Because these court battles will be public, not only will the contents of Franklin’s estate be available for everyone to see, but her family’s potential squabbles will likely be the subject of news headlines. All of these things could’ve been prevented with a well-drafted and counseled estate plan.
Not Just for the Wealthy
While trusts used to be available only to the mega wealthy, they’re now used by people of all incomes and asset values. Unlike wills, trusts keep your family out of the probate court, which can save both time, money, and a huge amount of heartache. Plus, a properly funded trust (meaning all of your assets are titled in the name of the trust) keeps everything totally private.
Trusts also offer several protections for your assets and family that wills alone don’t. With a trust, for example, it’s possible to shield the inheritance you’re leaving behind from the creditors of your heirs or even a future divorce.
Moreover, trusts also offer protection if you become incapacitated and are no longer able to make decisions about your financial and healthcare needs. Using a trust, you can appoint someone of your choosing (not the court’s) to handle your financials if you’re unable to. With only a will in place, your family would have to petition the court to appoint a conservator or guardian to handle your affairs, which can be costly, time-consuming, and stressful.
Finally, if you have a child with special needs like Franklin did, a Special Needs Trust can prevent your child from losing eligibility for important government benefits, like Medicaid and Social Security. A Special Needs Trust—also not subject to probate—allows you to contribute funds for your child’s care without disqualifying them for these benefits.
Don’t wait another day
Regardless of your financial status, planning for incapacity or your eventual death is something that you should immediately address, especially if you have children. You never know when tragedy may strike, and by being properly prepared, you can save both yourself and your family massive expense and trauma.
Proper estate planning can keep your family out of conflict, out of court, and out of the public eye. If you’re ready to create a comprehensive estate plan, contact us today for more information—we promise to make it easy.