Recently, a famous musician, especially popular in my generation, passed away suddenly at the very young age of 57. While very fond of his music, his planning was disappointing.
Not only will he be missed, but his lack of a basic planning tool, may lead to many terrible outcomes.
No Will ?
It is estimated the Prince’s net worth is near $300 million. Certainly he had been advised to create an Estate Plan with the appropriate documents to help ensure a fluid transition, should he pass.
For whatever reason, by Prince not having a Will, his estate may have some of the following challenges.
- Unknown spirit of wishes – The courts will decide who gets what, rarely a desirable outcome.
- Massive extra expenses – While the courts decide who gets what, the extra avoidable expenses are certain to mount.
- Delay – It would not be surprising to us for it to take a decade (yes, 10 years or more) to completely settle the estate.
- Friends/relatives come running- Just as a lottery winner finds she has many new friends and unknown relative, $300 million will certainly draw attention and confusion.
- Taxes- Prince’s estate will be subject to multiple levels of taxes, not all would have been avoided, but without any planning, the federal government stands to receive much more than otherwise would have been necessary.
It will be interesting to find out why Prince chose not to have any plans….heck, we may never know. No matter, while his music has left a legacy, his mistake certainly can teach us all an easy lesson!
Have a Great Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth