Rapper Coolio died at age 59 after being unresponsive on a friend’s house floor. His real name was Artis Leon Ivey Jr., and his former manager, Jared Posey, recently filed a probate case to appraise the value of his estate, according to a recent article “What Coolio, Prince and Picasso didn’t have that you should” from MarketWatch.
The filing names Coolio’s seven adult children, who reportedly wear his ashes in necklaces, as his next of kin and likely beneficiaries of his estate. There are also three other children who are under legal age.
The estate’s estimated value is more than $300,000, including personal property, demand deposit accounts, financial accounts, insurance policies, and royalties.
Coolio is far from alone in failing to have a will. A 2021 Gallup poll revealed that fewer than half of adults in the U.S. have a will outlining how they want their estate to be handed over upon their death. It’s a recipe for disaster for their families.
Dying without a will—dying intestate—means a local probate court has to decide how to distribute property according to state law, which can take months or even years. What finally occurs may not be what you intended. However, it will be too late.
A will is only one of many tools in the estate planning toolbox. You also need an updated Medical Power of Attorney, a Financial Power of Attorney, and to have beneficiary designations on all of your accounts. The beneficiary designations override your will, which is often news to loved ones.
If you have a beneficiary listed on your 401(k) plan, the person listed will receive the assets in the 401(k), regardless of what is in your will. You want to ensure beneficiaries and secondary beneficiaries are all up to date on your accounts.
Another important consideration: if a spouse is cut out of a will who would typically receive an inheritance, they have legal standing to challenge the will in court.
For a complete estate plan, you need a Durable Power of Attorney, which states who can make financial decisions on your behalf if you are incapacitated. A Medical Power of Attorney names a person to make medical decisions for you if you cannot make them yourself, and guardianship designations if you have minor children.
These documents, including beneficiary designations, need to be reviewed and updated with your estate planning attorney every few years or after any significant life changes.
Other accounts, like brokerage or bank accounts, may have “Pay on Death” or “Transfer on Death” designations that immediately put the assets into the named person’s hands upon your death.
Another item to consider is a letter of intent, in which you describe your final wishes regarding burial or funeral to the executor of your estate. This document is not legally binding but can be used to share your desires. The will may not be reviewed until after the funeral, so final directions for funerals, cremations, memorial services, etc., should not be in the will.
You can create a list to append to your will listing who will receive certain tangible items, like the family silver or your mother’s pearls. One good thing about having such a list is that it allows you to update beneficiaries of your tangible personal property without updating your will. Be sure the list doesn’t contradict anything in your will, and describe the items with great detail. You might also want to include contact information, so your executor can quickly locate the person and ensure the items find their desired home.
Better yet—give the items away before you die. You won’t have to worry if they won’t get to the right person, and you’ll get to share the person’s enjoyment when they receive the gifts.
Reference: MarketWatch (Dec. 31, 2022) “What Coolio, Prince and Picasso didn’t have that you should”
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