When a family is grieving, you can avoid adding to that burden by making and updating your estate planning. Many people put it off leading to legal battles, tax bills, financial chaos and family stress. Learning from the mistakes made by people in the public eye provides good lessons for everyone, says a recent article from CNBC, “3 end-of-life money mistakes celebrities have made—and how you can avoid them.”
Singer Aaron Carter – No Will
Aaron Carter was just 34 when he died suddenly without a will, leaving behind an 11-month-old son and a fiancée. In California, the court designates the child as the sole heir when an unmarried person dies without a will. However, Carter’s son was a minor, and minors may not legally inherit assets. In this case, the court appointed a fiduciary to manage the estate. Less than 2 years after his death in 2022, it was reported that his estate was insolvent due to outstanding debts, taxes, and attorney’s fees.
A better way: have an estate plan created, even if it’s just a will. Parents of minor children should have a will to name a guardian, unless they want the court to appoint a guardian. An estate plan could also be used to manage care for a loved one if you aren’t married.
Another problem is created when there’s money but no estate plan. Few people want an 18-year-old child to inherit large amounts of money with no guardrails in place. A trust is an excellent way of setting terms and conditions on an inheritance, whether the parent is living or has died.
Basketball Superstar Kobe Bryant – No Update
When Kobe Bryant died tragically in a helecopter accident in 2020, his family learned an expensive lession about what happens when you don’t update an estate plan. Although he had an estate plan which included a trust, he had not updated that trust to include his youngest daughter Capri. As a result, she wasn’t legally a beneficiary of his estate. His widow had to go to court to petition to have their daughter added to the trust.
Had the trust been updated, his widow would not have had to go through this process in the public eye, during a period of intense grief.
Your estate plan needs to be updated when new family members are welcomed. The same is true for any big life event, like marriage, divorce, death, or a major financial change. Estate planning documents need to reflect the changes in your life.
Actor James Gandolfini – No Tax Planning
James Gandolfini’s estate offers a harsh lesson in how careful estate planning is needed to prevent an estate from being decimated by taxes. Gandolfini had taken the time to create a will. However, no tax planning was done for his estate. His $70 million estate paid an estimated $30 million in federal and state estate taxes before making distributions to friends and relatives.
An experienced estate planning attorney will be able to review your situation and determine which strategies will work best to protect your estate and your family. Everyone needs to have an estate plan, no matter the size of your estate or how many people recognize you when you walk down the street.
Book a call today to get started!
Reference: CNBC (April 20, 2025) “3 end-of-life money mistakes celebrities have made—and how you can avoid them”
