Tag Archives: Prince

How does someone with a $300 million net worth NOT have a Will?

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
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

 

 

Partying Like it’s 1999…..Is It .Com Time Again?

Do you happen to remember the Popular Prince song that told of the times in the late 90’s “Party Like it is 1999”?

Our old Prince song came to mind with the recent social media IPO, Linked In, and the interesting first few days of trading, along with the hype associated with the initial public offering.

For those that missed the action, the stock immediately bolted to an almost double (gain of 100%) in the first few seconds of trading from the initial offering price (there were a measly 7 million shares available for investors to fight for on the initial offering) valuing the company near $9 billion, even though it is absent of firm earnings, steady revenues, and a stable business model.

One of our favorite NYU professors, Ashwath Damodaran, has an article on the Linked In valuation that might be interesting to read (we do not make any sort of value judgements in this venue.)

Following the success of Linked In, yesterday Yandex, the “Russian Google” was available for trading on our exchanges here in the US. With more shares available for trading the stock popped only 54% on the first day of trading.

Maybe it is 1999 again? But we doubt it!

Have a Great Day!

JK