While Michael Jackson wasn’t known for his sound decisions during his lifetime, there was one he actually got right: estate planning. His estate plan not only provided for his loved ones, but he placed a large majority of his assets into a trust where it remained out of the public’s concern and safe from creditors. So what did Michael Jackson teach the rest of the world?
Create a Will
You would think making a will would be an easy decision, but it isn’t. It is estimated that two-thirds of Americans don’t have an estate plan. When you don’t have an estate plan, a probate court judge will divvy up your assets in accordance with state law, which means they could fall into the hands of heirs you never intended.
Create a Living Trust
Jackson created a living trust – also referred to as a revocable trust. This allowed him to place his property and assets into a trust that was owned by his family – not just him. He also made sure his estate plan poured over any assets that weren’t listed in the trust, which protected those assets from creditors, taxes and the hassles of probate court.
All of Jackson’s kids were minors; therefore he made sure to list a guardian for his children so that they were protected and cared for. He selected his mother as the primary guardian and Diana Ross as his secondary, backup. Even though the court will have to approve these selections, the courts rarely deny a guardianship designation unless you specifically select an irresponsible person.
- Estate Planning is Essential Whether You Are Married or Not - April 25, 2018
- Income Tax Basis in Estate Planning – Part 2 - April 23, 2018
- The Downsizing Generation: How to Handle a Surplus of Stuff When a Loved One Ages - April 18, 2018