Everyone dies — even celebrities. However, their legacy and yours will live on. However grim it might be, estate planning is essential for getting all your end of life wishes in order. Picking an executor, assigning beneficiaries, and deciding what’ll happen with your property, etc, can all be detailed in a will, trust, or other estate planning document.
There’s lessons to be learned from celebrity estate planning since their lives and deaths are so public. You can avoid estate planning mishaps, for example, not NOT planning a will like Jimi Hendrix or leaving your entire fortune to your dog like Leona Helmsley… You might also consider giving your estate to charity like these celebrities:
They Gave it All Away… Or Are Planning To!
Some wealthy celebrities aren’t as selfish as we might think they are. Lots like Bill Gates, Warren Buffett and Mark Zuckerberg have taken The Giving Pledge, a campaign encouraging wealthy people to donate their fortunes to worthy causes, either during their lifetimes or when they die. Some of these celebrities’ kids won’t be getting a dime.
It might seem harsh, but there’s a reason behind their rejection of inherited wealth. Donating your estate to charity might be an appealing option especially if you feel your children and grandchildren will have enough to survive. Check out these celebrities’ stories to find out if charitable giving works for you.
11. Bob Barker
NET WORTH: $70 million
The retired game show host has always loved animals and plans to leave his estate to animal welfare charities when he passes. Barker has been invited to many events hosted by animal rights groups throughout his life. So far, he’s donated quite a bit of his fortune during his retirement.
Some of the causes Barker has given to are: $5 million to the Sea Shepherd Conservation Society, $2.5 million to PETA, $700K to elephants in a Toronto zoo, $1 million to Columbia Law’s animal rights studies, and he supported the United Activists for Animal Rights. He has also been a vegetarian since 1979.
10. Jackie Chan
NET WORTH: $350 million
The actor, famous for his martial arts centric comedy movies, is planning to donate half of his fortune to charity according to the LA Times. As for the other half of his estate? It’s definitely not going to his son, Jaycee, by the sounds of it. Chan doesn’t seem to think Jaycee is the model son.
Jaycee has gotten in trouble with the law for drug possession several times, including once in China in 2014. His dad publicly apologized for his behavior. Kind of a bad look for the Chans as Jackie was named China’s anti-drug ambassador in 2009. Regarding his estate, Chan reportedly said: “If he is capable, he can make his own money.”
9. Simon Cowell
NET WORTH: $550 million
The X Factor and American Idol judge plans on his estate going to charity — specifically something benefitting “kids and dogs.” His young son, Eric, will not be getting a dime. Cowell was reported to say “I don’t believe in passing on from one generation to another,” in the Daily Mirror.
This perspective echoes that of fellow Englishman, Andrew Lloyd Webber. These workaholics also want their kids to know the value of hard work! Cowell argues that: “Your legacy has to be that, hopefully, you gave enough people an opportunity so that they could do well, and you gave them your time, taught them what you know.”
8. Andrew Lloyd Webber
NET WORTH: $978 million
The man behind musicals Phantom of the Opera and Cats plans to donate most of his estate to struggling artists in the theater community. He told the Daily Mirror in 2008: “I feel I owe a debt and that is very largely due to the success not only in Britain but also the rest of the world.”
Lloyd Webber has five children from two marriages but doesn’t plan to give them the majority of his money. He told the Daily Mirror he’d give them a solid start in life but expects them to work just like he had, not just benefit off his company Really Useful Group.
7. Ted Turner
NET WORTH: $2.2 billion
Founder of CNN and TBS, Robert Edward Turner III intends to leave his wealth to charity when he passes. He’s already been philanthropic throughout his life, setting up the Turner Foundation for environmental causes and the United Nations Foundation in 1997 with an initial pledge of $1 billion. His children will be able to work with his foundation.
Turner has five children but they’re not going to benefit wildly from his fortune. In fact, Turner joined fellow billionaire, Warren Buffett, in the Giving Pledge. This campaign encourages wealthy folks to donate a majority of their wealth to charity, either during their life or upon death. Participants aren’t obligated to donate but it sounds like Turner will come through with his promise.
6. George Lucas
NET WORTH: $5.6 billion
“Star Wars” creator George Lucas intends to give his fortune, made from selling his franchise to Disney, to educational purposes. Lucas made $4.5 billion from the sale and echoed his commitment to donating in a 2012 Giving Pledge letter. (The same pledge taken by Ted Turner and Warren Buffett.)
In Lucas’ letter, he stated: “As long as I have the resources at my disposal, I will seek to raise the bar for future generations of students of all ages.” Lucas has four children of his own, but is set on using the money from his Disney sale for children in need.
5. Pierre Omdiyar
NET WORTH: $11.6 billion
eBay founder and chairman Pierre Omdiyar says he and wife Pamela Kerr intend to give away most of their fortune during their lifetimes. Omdiyar wrote in his Giving Pledge that his family has more than enough money: “There’s no need to hold onto it when it can be put to use today, to help solve some of the world’s most intractable problems.”
Omdiyar and Kerr have already gotten started on their philanthropic activities by forming the Humanity United Foundation. The foundation supports anti-slavery nonprofits. The reclusive Omdiyar has three children but doesn’t plan to give them all of his wealth when he passes. Perhaps because the tech wiz came from humble beginnings himself?
4. Michael Bloomberg
NET WORTH: $51.2 billion
Like his fellow wealthy philanthropist, Bloomberg also plans to give away his fortune as per his Giving Pledge. He stated in his letter: “If you want to do something for your children and show how much you love them, the single best thing — by far — is to support organizations that will create a better world for them and their children.”
That means Bloomberg’s two adult daughters, Emma and Georgina, won’t directly receive an inheritance from their father. The former NYC mayor originally made his fortune owning Bloomberg, the financial information institution. So far, his philanthropic activities include creating the Bloomberg Philanthropic Foundation which donates to causes ranging from literacy to health.
3. Mark Zuckerberg
NET WORTH: $62.7 billion
Zuckerberg and wife Priscilla Chen said in their Giving Pledge that they will give away 99 percent of their shares in Facebook during their life. They decided to make this announcement when their daughter, Max, was born. They wrote that their money will go towards advancing “human potential and [to] promote equality for all children in the next generation.”
Specifically, Zuckerberg and Chen’s wealth would be used in causes that promote education and curing diseases. Zuckerberg is so far the youngest person to take the Giving Pledge at 32 years old. He’s also one of the billionaires earning a $1 salary. Perhaps it’s a tax game at work? Or looking out for shareholders? Hmmm…
2. Warren Buffett
NET WORTH: $89.7 billion
Buffett has made it clear that he’s not into leaving a mega inheritance for his family: “I’m not an enthusiast for dynastic wealth, particularly when 6 billion others have much poorer hands than we do in life,” he said during an event at the New York Public Library in 2006. He announced that he’d give away 85 percent of his wealth according to the NY Times.
The Berkshire Hathaway owner also made a Giving Pledge, just like Zuckerberg, Lucas and Bloomberg. Buffett has been known for joking about the attitudes other mega-wealthy people like him. The NY Times reported him making fun of his peers talking about the “debilitating effects of a welfare society.” He says those folks still leave their children all the money they could possibly need.
1. Bill Gates
NET WORTH: $97.9 billion
Microsoft founder Bill Gates plans to leave the majority of his estate to his own charity, The Bill & Melinda Gates Foundation. He will leave his three children (Phoebe, Jennifer, and Rory) $10 million each apparently. That’s not particularly a lot considering the tech mogul has nearly $10 BILLION to his name.
According to an “Ask Me Anything” he did on Reddit in 2013, he was in part inspired by Buffett’s views on the downfalls of inherited wealth. “I definitely think leaving kids massive amounts of money is not a favor to them,” said Gates. “Warren Buffett was part of an article in Fortune talking about this in 1986 before I met him.”
Celebrity Estate Planning Blunders: What Can We Learn From Them?
Rest in peace, Heath Ledger, Jimi Hendrix, and Marlon Brando… It’s sad to lose stars so bright like them, and even sadder when their assets left behind are being fought over. If these stars we listed below were able to fully get their affairs in order, they might have avoided estate planning blunders.
You can learn from their sad tales, and apply them to your own estate planning. A certain step of planning might not seem like a big deal buuut if you see how shortcuts turn out in real life, you might think twice. Read on to find out more.
9. Sammy Davis Jr.
NET WORTH: $5 million
Sammy Davis Jr. sure could sing and dance, but his finances weren’t as good by the time he died in 1990. He ended up leaving a large tax bill that his estate wasn’t able to pay. He did ultimately leave a very nice will that was generous to his beneficiaries but his estate ended up being more debt than assets.
So what can we learn from Sammy Davis Jr.? Getting your affairs in order before you go is a good route, so your loved ones won’t be saddled with huge debts. Debt collectors will call THEM if they can’t call you…
8. Heath Ledger
NET WORTH: $16 million
Heath Ledger died in 2008 at age 28, very young to be thinking about wills and trusts for most individuals. The actor did have a will at the time, however, but he didn’t update it at the time of his passing. He’d written it three years prior, before dating Michelle Williams and the birth of daughter Matilda Rose.
Ledger’s estate was left to his parents and sister in his will. Had he updated it, Matilda Rose and even Michelle Williams could have benefitted from it. The lesson we can derive from this instance is to update your will when life changes. For example, if you get married, have a child, or buy a house.
7. Marilyn Monroe
NET WORTH: $20 million
Model and actress Marilyn Monroe didn’t take her estate planning far enough, according to Fox Business. The blonde bombshell left three fourths of her estate to her acting coach, Lee Strasberg. That’s all well and good, but when Lee died, Monroe’s assets went to Lee’s third wife Anna. Monroe and Anna never knew each other.
Later, Anna licensed Monroe’s products and auctioned off a lot her belongings. One of these was the gown that Monroe wore to John F. Kennedy’s birthday party, which sold for more than $1 million. Anna sold the rest of Monroe’s estate for $20-30 million, according to NPR. Moral of the story? Get a trust!
6. Philip Seymour Hoffman
NET WORTH: $35 million
American Bar makes some assumptions about the late actor’s estate, mainly that Hoffman executed his will before his daughters Tallulah and Willa were born. The website says it’s probable that Hoffman had not updated his will since then. Therefore, Willa and Tallulah might not be able to access their dad’s assets.
The lesson we can learn while contemplating the contents of Hoffman’s will is to update your will when life changes happen. Some states, like New York, don’t require parents to give children any part of their estate. You can double check the requirements in your state but it’s better just to keep your will updated…
5. Anna Nicole Smith
NET WORTH: $50 million
The estate of Smith’s late husband, J. Howard Marshall II, was the cause of much litigation between the actress and Marshall’s sons J. Howard III and Pierce. Before Marshall II died in 1995, his estate was transferred to a revocable trust. The trust was probated in August 1995, with both Smith and Marshall III protesting.
They both fought over what amount was due to them. Smith said that Marshall II had promised her a certain amount of his estate. However, oral promises don’t mean much in court. Ultimately, Smith’s estate gained nothing from Marshall II’s. Again, life changes (even a marriage that lasts 14 months…) deserve a revision within someone’s will.
4. Marlon Brando
NET WORTH: $100 million
Here’s another instance of oral promises creating conflicts. Silver screen star Marlon Brando apparently promised his caretaker, Angela Borlaza, the house she lived in and employment with a company he owned. Borlaza ended up settling with Brando’s executors for $125,000 and settled the claim regarding her employment out of court.
Moral of the story, again, is oral agreements don’t mean anything. If Brando really did promise his “majordomo” a house and employment, he should have written these agreements down in his will. Anything you plan on promising to loved ones after you’re gone has to be written down in legal documents. Otherwise, they might be caught up in lawsuits.
3. Jimi Hendrix
NET WORTH: $175 million
Forbes lists guitar hero Jimi Hendrix’s estate planning as a “blunder,” as he didn’t have a will at the time of his death. The legendary musician died unexpectedly at the young age of 27, an age much too soon for most to think of writing a will or trust. However, we can still learn from the musician’s experience.
After his death, Hendrix’s fortune went to his father, Al Hendrix, and his brother Leon didn’t receive anything. As a result, Al’s adoptive daughter through another marriage was favored over Leon. In your own estate planning, WRITE A WILL, otherwise, your assets won’t benefit family you care about.
2. David Bowie
NET WORTH: $230 million
Rockstar David Bowie could have benefitted from flexible lifetime trusts, according to AmericanBar.org. When he died in January 2016, he left his wife Iman Mohamed Abdulmagid her share in a marital trust. That means that Iman will pass along the trust to children Duncan (from Bowie’s first marriage) and Lexi.
American Bar says that: “Creating lifetime trusts would have protected each child from creditors for his or her entire lifetime and allowed Bowie to use his full GST exemption.” Despite potential improvements Bowie could have made with his estate planning, his affairs were in order compared to the blunder this next celebrity made…
1. Leona Helmsley
NET WORTH: $8 billion
Wealthy hotelier Leona Helmsley made the blunder of leaving $12 million in a trust to her dog, Trouble, and leaving nothing for her grandchildren. The “Queen of Mean” also intended that her estate provide for dogs “and such other charitable activities as the trustees shall determine” according to the NY Times.
Turns out a dog doesn’t need $12 million, especially if they’ve died too. After Trouble passed, a judge reduced the pup’s trust to $2 million and Helmsley’s grandchildren got $6 million. Lawyer and author Herb Nass said that her judgement “makes me think she did not quite understand the extent of her wealth in some ways.”
8 Must Do’s For Estate Planning
There are many parts to estate planning, so the process can get super overwhelming. It’s wise to hire professionals, like an insurance agent and a lawyer that specializes in wills and trusts, in addition to creating a checklist for yourself. It’s also a bit depressing having to go through and plan your life’s end, but remember: Everyone has to do it!
The following are a few’to do’s’ we recommend before starting out on your estate planning journey. There’s more to it of course, but you’ll have to meet with a knowledgeable lawyer and insurance professional to get the full low down. These steps are important even if you plan on giving it all to charity like Bob Barker and Bill Gates do!
1. Consider Life Insurance
This is good to consider for the sake of your family. If you don’t have family to leave your assets to (or you don’t want to…) then skip to number two below. Life insurance will pay out a lump sum of money to your beneficiaries when you die. Having this coverage will help your family with expenses when your fortune can’t.
Like other types of insurance, you’ll need to determine what kind of coverage you’ll need. Kiplinger recommends considering what you’ll need to pay off your debts like mortgage, car loans and probably student loans (especially if you’re a Millennial) and how much you’ll need for financial goals, like sending kids to college. Divide the sum by 5 percent — that’s how much you’ll need!
2. Take Inventory of Your Assets
This way, you will determine your net worth and your estate’s worth. Considering your house, car and bank accounts are the easy part but there might be more complicated things, like a family business. That might require a legal professional’s help in determining. Don’t hesitate to get help when you need it.
You’ll first need to compile a list of all of your assets before meeting with an attorney, however, in addition to doing some basic research on the types of assets you have. Maybe you have stocks and bonds? A 401K? If you know the basics of what must be done with all of these assets, your meeting with a lawyer will be much more fruitful.
3. Determine Your Beneficiaries
So here’s the part where you get to play “favorites” with your children! Joking — or are we? In any case, you’ll need to pick who your beneficiaries are. It could be kids, grandkids, a spouse, nephews, nieces, etc. Or if you don’t have a family to leave assets to, you can pick a cause or person to receive your fortune.
Your beneficiary will be the name in your life insurance policy and/or your will. These documents will detail who the beneficiary is, what items they will receive, and/or how much money they will receive from you. We can’t tell you who to pick, but it’s recommended that they be people you actually like and trust.
4. Find an Attorney
You shouldn’t attempt to draw up estate documents on your own. Get a professional to do this! You can get a referral to one that specializes in estate planning from friends and family, do a Google search, or check the American Bar Association’s referral directory. Make sure you do some of your own research on the attorney.
You can even interview them on their experience before signing on. This will determine if their skillset best serves you. Especially if you have a complicated estate (if you have a family business, for example) and need advice on choosing trustees and children’s guardians. An attorney will also help you go through your checklist to make sure you’re not missing anything.
5. Determine Who Will Manage the Plan
The executor of your plan can be a family member, lawyer or corporate trustee — it just depends on what your assets are. Again, an estate attorney will be able to advise you on the best course of action to take depending on your unique situation. It’s also advised to consider an executor that can have power of attorney.
This is advisable just in case you have an instance in which you become incapacitated and can’t make decisions. Consider a living will with details on medical decisions or end of life directives. Someone that acts as power of attorney might not always make the decisions that you would if you’re incapacitated.
6. Determine Type of Plan
Since everyone has a different lifestyle and assets in their possession, it makes sense that everyone will need a different estate plan. Consulting with an estate planning attorney, and even an insurance professional, can help determine what sort of plan will work for you. Typically, a will makes sense for most people.
However, those that own real estate or land in other states might want to consider a revocable trust. This is a trust in which provisions can be changed or stopped, depending on the grantor. Income is distributed to the grantor while the trust is alive. After you die, the property will be transferred to your beneficiaries.
7. Get a Last Will and Testament
If you don’t need a revocable trust, you’ll just need a will and testament. These will take care of property that needs to be probated and any minor children (or adult children with disabilities). This document will determine who will get property after you pass, who the executor of your will is, and will appoint guardians to dependents.
Basically, it’s instructions for those that survive you to take care of any loose ends. Extra bonus is that your executor is legally obligated to carry out your wishes — an attorney will make certain of that! Wills and testaments give people peace of mind that nothing is left undone when they die.
8. Leave Information for Executor and Statement of Desires
Legalzoom’s blog recommends leaving a document with basic information to your executor. It’s not legally binding by any means but it’s helpful to have so they know where to find your legal documents, financial documents, insurance information, vehicle titles, etc. Maybe even throw in some contact information for relatives or friends that might be able to help them.
Definitely include information for contacting your estate lawyer, if they have any questions. You can also have instructions for your funeral and burial, e.g. if you prefer cremation or burial or want your funeral organized in a certain fashion. This’ll give you peace of mind that everything will go according to plan.
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