Between the paparazzi and social media, we often know more about celebrities than we care to. In fact, they are so far removed from your life, you may feel that there is nothing to be learned from their trials and triumphs. However, sometimes we can learn what not to do especially in terms of their estate planning. In this article, we will explore what you can learn from celebrity trusts.
Philip Seymour Hoffman, a talented actor who died in 2014, reportedly did not want his children to become “trust fund kids.” So, he used a Will-based estate plan and left everything to his long-time girlfriend and mother of their three children.
There are several things we can learn from Mr. Hoffman’s distrust of trusts:
Michael Jackson at least tried to set up an estate plan to care for his children and his mother. Unfortunately, this accomplished musician and dancer forgot one important step – funding his trusts. Fortunately, his Will included pour-over provisions that transferred estate assets to the trusts he had established. However, his estate assets had to pass through probate before being transferred to the trusts.
What you can take away from Mr. Jackson’s estate planning is this: Fund your trusts. Otherwise, your trust is just an empty vessel.
It should be noted that in some situations, particularly for married couples in the state of Florida, it may be prudent to enjoy the creditor protection advantages that tenancy by the entireties (a form of joint ownership available only to married couples) ownership provides while both spouses are alive. Upon the first death, assets belonging to the surviving spouse should probably then be transferred into trust.
When actor Paul Walker died in 2013, he did leave behind a trust for his daughter, Meadow. In fact, she was the sole beneficiary. However, he had prepared his estate plan before becoming a successful actor and did not update it when his financial circumstances changed. We do not know the terms of the trust, but he likely missed ways to protect his daughter and minimize taxes by not reviewing his estate plan.
The takeaway here is that estate plans should reflect the testator’s life. As life changes, give your estate plan a careful review with your estate planning attorney.
John Mangan is an experienced Florida estate planning attorney who has been board certified in Wills, Trusts & Estates by the Florida Bar. At Law Offices of John Mangan, P.A., we help clients develop an estate plan that’s appropriate for their circumstances. Call us at 772-324-9050 to set up an appointment or use our Contact Form. With our office located in Palm City, we also assist clients in surrounding communities like Stuart, Hobe Sound, Jupiter, and Port St. Lucie.