Purple Rain with a high chance of thunderstorms. I believe this is when doves cry.
Prince, one of the greatest musicians/performers of our time, who was worth nearly $300 million; passed away in April of 2016, without a legally binding Will or Estate Plan in place. He left behind one biological sibling Tyka Nelson and five living half siblings. Because of this lack of planning, Prince’s entire estate was left in the hands of the court leaving his heirs watching and waiting as estate administrators burned a reported $600k per month in legal and administration fees. In essence, the heirs have become servants of the State as they await the probate process.
The world was flabbergasted by this news. I mean; surely it wasn’t because he couldn’t afford an Estate Plan, so what would keep Prince from tying up this loose end? Prince is someone who undoubtedly had a team of people; managers, executive heads, assistants, and so forth. Our educated guess is that this very vital piece of business was left undone for the same “reasons” many Americans do not have an Estate Plan today-they just never got around to it. Not to mention, some people simply don’t know or understand what Estate Planning is and why it matters.
For two years, Prince’s estate has been tied up in probate court due to more than 45 people who have come out of the woodwork claiming to be heirs. Thankfully for his biological heirs, none of them have prevailed and a judge has ruled that Prince’s sister and his five half siblings are the sole and lawful heirs to his fortune. The heirs will divide an estate valued at $100-$300 million but not before nearly half is paid to taxes and all legal and administration fees are paid. As of April 21, 2018, it has been two years since Prince passed and, to date, the estate still has not distributed funds to the heirs. As the heirs wait, they calculate all that they’ve lost. Aside from the loss of a beloved brother, they see the estate dwindling as estate administrators charged $125k monthly and accrued legal fees of a reported $440k in November 2017.
We may find it hard to sympathize with the family who should still see nearly $20 million each, but proper estate and trust planning could have avoided the costly and time-consuming probate process and maintained family unity. The key goals of a properly drafted Estate Plan are to; 1) ensure financial security for you and your heirs; 2) effectively manage the estate after you’re gone; 3) protect assets from potential creditors and lawsuits and; 4) transfer wealth with the lowest possible tax bill. Unfortunately, Prince failed on all counts to protect his estate and his legacy.
Whether you are a millionaire or just a hard-working middle-class citizen with a couple of siblings and kids, you need an Estate Plan. An Estate Plan often goes beyond a simple Will, providing protection and security for your family and your financial legacy. In short, if you’d like to leave a sense of peace, a blanket of security, behind for your loved ones while helping your family avoid a mess, then an Estate Plan is for you, no matter your net worth.
About the Author Scarborough Law, LLC is a multidisciplinary practice born out of the founding partner’s frustrations with the delays and bureaucracy of traditional law firms. Scarborough Law, therefore, provides client-focused legal services aimed at recognizing the needs of their clients and delivering a superior personalized service.