Celebrities often have the largest estates and the most reason for considering proper estate planning. Yet beyond simply protecting your assets and valuables and ensuring that they go into the right hands, artists also carry the need for proper legacy planning. Legacy planning is separate from estate planning – it’s about utilizing the legal tools provided to you protect your legacy, in a way that allows it to continue to profit your family for possibly generations to come.
Kurt Cobain, the front man for one of the most famous alternative/grunge rock bands in the history of music, and a man known for his musical genius and untimely passing, didn’t have a legacy plan. He didn’t even have a will. Thus, intestate law decided that everything he owned – including the rights and royalties from his music – would go to his wife and their daughter.
Since then, however, Cobain’s estate has been the subject of fierce legal battles and decades of unnecessary litigation. All that could have been avoided with a little legacy planning – saving everyone involved a lot of suffering and grief.
This isn’t uncommon for celebrities in general, sadly. But it’s not just the rich and famous who have trouble planning for after their death: most of us do. It’s just that the stakes are even higher with the rich and famous.
When to Start Preparing Your Legacy Plan
Most people don’t want to think about dying, not until it becomes abundantly clear that our time is near. That’s not unnatural, of course. It’s perfectly normal to block out the idea of dying, especially at a relatively youthful age, and especially when your life and family are just beginning to grow.
But the ideal thing to do, if you want your children and family to go through as little pain as possible after your death, is to address the issues with inheritance and legacy as soon as they become relevant – meaning, as soon as you have something to pass down, and someone to pass it down to. Otherwise, your death may not just be a tragedy, but a prelude to years of litigation and bitterness.
That means that setting up your legacy plan is something you should be thinking about even as your legacy is still budding – wills and trusts can be revoked and rewritten, amended and fixed. But if you die without leaving behind any legally-relevant documentation on how you want your legacy to go on, then the result is simple: your state’s laws will decide what happens next. That’s what intestacy is. Typically, the surviving spouse receives priority, as well as any children.
That’s the first lesson to be learned from Cobain, and many other celebrities: make a plan, and be ready to create an estate and/or legacy plan as soon as you have something to pass down, rather than waiting for retirement.
Prenuptial Agreements Are Not Guaranteed
Cobain’s legacy is back in the news because his daughter, Frances Bean, is in the middle of a legal battle with her recently divorced ex-husband, musician Isaiah Silva. In marriage, one spouse is entitled to half of community property in CA – unless an agreement is drafted and signed before the marriage takes place.
However, not every couple signs a prenuptial agreement. And that means that a substantial portion of your financial legacy could fall into the hands of a stranger if your child decides to marry and divorce someone without first making it clear that they aren’t entitled to your child’s inheritance.
If you decide to put your assets and belongings into a trust, instead of a will or nothing at all, then your child may be listed as a discretionary beneficiary, with no control over the trust – and thus no ownership over the assets – while still getting payouts and dividends.
A trust is different from a will, which is essentially a form that details how you wish the ownership of your property to change. In a trust, everything you own is now property under the trust’s name, over which you retain control. That way, you can pass property through to the next generation after your death without the probate process – and without endangering your child or spouse’s potential inheritance if they decide to marry/remarry without a prenuptial agreement.
With this simple second lesson – by properly preparing your estate to survive a divorce, and other possibilities down the road – you can further avoid passing on your legacy to someone outside your family.
Legacy Planning 101
A person’s legacy is the sum of what they leave behind. It can be their image, their creation, or even what they are most remembered for. While that’s entirely separate from the purely material estate a person leaves behind when they die, many assets can exemplify a person’s legacy – and these assets must be carefully planned for. For example, royalties from music and writing, or residuals from acting, dividends from famous investment choices, and much more.
When you die, you not only want your legacy to be protected and portrayed in a good light – you want to ensure that what you leave behind goes to your family, and stays in the family and the people who join it for the rest of their lives.
Legacy planning involves a lot of professional help. No two estates are exactly alike, and a professional opinion is necessary if you want to decide on how to deal with inheritance and legacy issues.
Ultimately, this isn’t meant to be conclusive legal advice, but rather a look into an interesting legal topic that most people don’t think about often enough – how to plan for the financial security of your offspring and your partner in the event of your death, and how to ensure that your legacy – everything you have worked for as a pioneer, artist, entrepreneur or visionary – lives on in a way you intend it to.
The path to a successful, well-crafted estate plan is much more complicated than simply considering these two legacy planning tips. Thus, having a legacy plan, to begin with, requires a different skillset from estate planning.
Your legacy and/or estate plan should be tailored to your needs, and be specific to your local state laws, circumstances, wealth and limitations. Be sure to consult a professional directly if you want advice on what to do, and what not to do, about your estate and legacy.