Avoiding Disastrous Estate Plans
by Randy Fox, CFP®, AEP®, Two Hawks Consulting
It shouldn’t take too much effort to realize that what Tom Petty and Aretha Franklin currently have in common are not their list of gold albums or chart-topping singles, but their disastrous estate plans. Both deceased musical icons have managed to pit family members against each other, while costing their heirs millions of dollars in legal fees and lost revenue potential. Unintentional? Bad advice? No advice? Ultimately, the cause of the disruption is less important than the fact that it exists and doesn’t seem likely to be resolved any time soon.
It was originally believed that Aretha Franklin died without any estate plan at all. This might have been less of a problem than what is currently happening as Michigan makes the rules of intestacy rather straight forward. As it turns out, though, there were three handwritten wills subsequently found in Ms. Franklin’s home, one under a couch cushion. This would be funny if it wasn’t so sad. Now the family is battling in court and relationships that were once close are being torn apart. Surely not the Queen of Soul’s intent. And with no planning, maximum tax will be due.
Tom Petty at least had documents. The fight is between his daughters and their stepmom, the new Mrs. Petty. And it’s no small fight since it is over control of all the intellectual property of the estate. When will it end? How will it end? Who knows? It is costing both sides financial and emotional capital. Will the family ever repair itself?
Where do you fit in all this? Most of us aren’t famous. Most aren’t as wealthy as Aretha Franklin or Tom Petty. But that doesn’t mean we should leave a mess behind when we die. It is not difficult to get our estates in order. It is not difficult to talk to our heirs about what decisions we’ve made that will affect their future. Aretha Franklin and Tom Petty knew what harmony was but somehow, they missed out on family harmony. And left on a sour note.