10 Estate Planning Mistakes to Avoid
Mistake Number 1 – Not Having a Plan (Prince)
Almost immediately after Prince died on April 21, 2016 we learned he did not have a will. Without a will, Prince’s estate, estimated at over $150 million and full of complex assets such as intellectual property, contractual rights, royalties, Paisley Park, etc., were to be divided among his closest living relatives as determined by the State of Minnesota.
It has been reported that Prince’s heirs include six people: his sister, Tyka Nelson, and his half-siblings, Norrine Nelson, Sharon Nelson, John Nelson, Alfred Jackson, and Omarr Baker. Alfred Jackson died in 2019, and shortly before his death he sold his interest in the estate to a company in exchange for an immediate cash payment. With the law allowing such sales, Prince’s estate with its vast trove of intellectual property will wind up being owned and managed by a company that had no relationship with the singer.
A document filed with the probate court for 2019 reported that the bank administering the estate received $1.5 million in fees. Troy Carter, the bank’s entertainment consultant, received $2 million and the law firm representing the bank earned about $3.8 million. And that says nothing of the millions in legal fees incurred by the beneficiaries as they squabble over the process of administering Prince’s estate.
If Prince was alive and able to plan his own estate and his own legacy, what would Prince have wanted? Probably not this.
It has been reported that Prince supported many charities and charitable causes over his career.
In 2011, for example, Prince donated $250,000 to Eau Claire Promise Zone, a citywide grassroots coalition of community partners committed to doing whatever it takes to ensure all of the city’s children are prepared to graduate from college and be successful in their career and in life.
Other charities Prince supported included:
Edith Couey Memorial Scholarship Trust Fund
Imagine the good that could have come from building a plan that treated his family fairly, and that supported these charitable causes. That would have been a legacy worth writing about.
How long has it been since you reviewed your estate plan with an attorney?