The 2018 passing of the “Queen of Soul” arrived with some surprising news. With an estimated $80 million estate, Aretha Franklin died without a will or a trust. Her four sons have recently reached an agreement with the IRS over a $7.8 million tax debt, which should move them closer to receiving money from her estate.
This story is more common than you might expect. Prince left his heirs in the same lurch a few years ago. Other celebrities who died without a will (intestate) include: singer-songwriter-congressman Sonny Bono; artist Pablo Picasso; guitarist Jimi Hendrix; and billionaire businessman Howard Hughes.
Passing without a will creates unnecessary hassles and enormous expense for one’s heirs. Yet, according to an AARP survey, 2 out of 5 Americans over the age of 45 do not have a will.
Writing a will isn’t the most pleasant of tasks.
After all, by doing so you’re not only acknowledging your own mortality but actively planning for it. Preparing a will, however, is one of the most critical things you can do for your loved ones.
What happens if I die without a will?
If you die without a valid will, your estate will be settled based on the laws of your state that outline who inherits what. You are said to have died “intestate,” and your assets will be passed by way of intestate succession. This means that the state gets to decide who gets your TV, your real estate, your car, your Apple stock, and anything else you may own.
Probate is the legal process of transferring the property of a deceased person to the rightful heirs. And, it can get very costly. In California, attorney and executor fees on a $1 million estate can each run $23,000, and about $113,000 apiece on a $10 million estate.
Without a will, a judge will appoint an administrator to serve in the capacity of an executor for your estate. That administrator will probably be a stranger to you and your family and may make decisions that wouldn’t necessarily agree with your wishes or those of your heirs.
People who want their estates settled in an orderly way and want to avoid fights among family members should, at a minimum, have a will. They should also consider putting their assets in a revocable trust; especially when probate proceedings are complex and expensive.
How often does a will need to be updated?
It’s possible that your will may never need to be updated — or you may choose to update it regularly. Remember, the only version of your will that matters is the most current valid one in existence at the time of your death.
Our clients often revisit their wills at times of major life changes. Transitions such as marriage, divorce, the birth of a child, the death of a beneficiary or executor, a significant purchase or inheritance, and so on, can trigger the need for a review and update. Your kids probably won’t need guardians named in a will after they’re adults, for example, but you might still need to name guardians for disabled dependents. We advise clients to review their wills every two or three years just to be safe.
When it comes to estate planning, preparing a will and trust may not be glamorous, but it is the best legacy you can leave your loved ones. We think it’s a great way to show R-E-S-P-E-C-T for your loved ones.