Terrible, horrible, no good, very bad idea of NOT having a Will

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Person writing on paper

A last will and testament certainly sounds like a complex document. But, when boiled down, your will answers just three simple, yet important questions.

  1. Who do you want to inherit your assets?

A will provides for the orderly distribution of your property at death according to your wishes. By property, I mean everything you own. Your property includes both tangible and intangible things. An example of a tangible item would be your stamp collection. An example of intangible items would be stocks and bonds.

mom and daughter holding hands

  1. Who do you want to be in charge of carrying out your wishes as expressed in the Will?

In a will, you also name the “executor” of your estate. The executor is the person who’s responsible for making sure the will is implemented as written. Needless to say, this is a very important position, and you want to name someone you can trust completely, and you know to be responsible and competent.

  1. Who do you want to take care of your kids?

If you have minor children (i.e., kids under age 18), you’ll want to designate a legal guardian(s) who will take care of your children until they are adults. Also, a will can set up a financial trustee (may be the same as the guardian) who can oversee and be responsible for your child’s funds until they are old enough (and mature enough) to inherit property.

The Kids are Alright: Guardianship for Children

 

Without a Will, There’s No Way

Without a last will and testament, you’ve given no guidance to anyone about who should inherit your property, who should be in charge of carrying out your wishes, and who you want to be your kids’ legal guardian. Not having a will creates unneeded stress and heartache, and even total chaos, for your loved ones and friends. This distress would also come at the worst possible time—when they are mourning your passing.

Drafting a quality estate plan that incorporates your wishes and goals is the height of responsibility. And if estate planning sounds intimidating, fear not! We’ll walk through the five steps of estate planning together. The best place to start is with my Estate Plan Questionnaire.

I’d love to hear from you. You can email me anytime at gordon@gordonfischerlawfirm.com.

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The Scary Tale of What Makes a Will Valid

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Halloween pumpkin

What makes a will valid? To begin, you are asking the entirely wrong question! [Cue evil sounding mwahahahaha.]

You must ask a more specific question what makes a will valid in Iowa. After all, every state can and does have different laws for a will’s validity, as well as for probate, trusts, and so on.

Iowa law has several requirements (sometimes called formalities) which must be present for a will to be legal and binding. If you miss even one formality–yes, even one!–you run the risk of your will being declared “dead.” Forever dead and invalid…which sounds like a nightmare for your loved ones.

In Writing (Can Be Blood or Ink)

ink and paper

Iowa law requires a will to be in writing. That means any oral statement of the decedent doesn’t count. This is true even if the oral statement(s) relate(s) directly to naming people who should inherit specific property. (Note that there’s a slight, teeny tiny exception to this for gifts causa mortis. But, these are super specific, situational, limited, and rare.)

Even a statement about passing of property recorded by audio or video cannot constitute a valid will.

Testatrix or Treat?

The person making the will must sign it, or direct some other person to sign the will in his or her presence. Lawyers call the person who makes the will either a testator (male) or testatrix (female).

Two Witnesses to Tell the Tale

Two witnesses to the will’s signing are also required. The person making the will, in the presence of the two people acting as witnesses, must declare the document is his/her will and request the two people to sign the document as witnesses. Then the witnesses must sign in the presence of each other, and in the presence of the testator/testatrix.

two people signing

Bearing Witness

There are also standards for being a qualified witness. A witness must be at least 16 years old and be mentally competent. A person who receives property under terms of the will may be a witness, but that person will have to forfeit any amount in excess of what s/he would receive if there were no will.

Are You Competent?

A will is valid only if the person making the will has sufficient competency at the time the will is made. In this situation, “competency” has two prongs: the testator must be of full age AND sound mind.

Full age simply means legal majority, which is age 18 (or 17 and married).

Is your mind sound?

All I can imagine with the phrase “sound mind” is the mad scientist saying “brainssss, brainsss!” But, is “sound mind” a real thing? Yes!

glass brain

A testator must indeed be of sound mind. The testator/testatrix has sufficient mental capacity if s/he:

  1. understands the nature of the instrument s/he is executing;
  2. knows and understands the nature and extent of his or her property;
  3. remembers the natural objects of his or her bounty; and
  4. knows the distribution s/he wants to make.

If s/he is unable to meet any one of these tests she cannot make a valid will. The mental capacity must exist at the actual time of the making of the will.

Did you say “natural objects of bounty?”

The natural objects of his or her bounty is a fancy legal phrase. Essentially this refers to a spouse and children, if any, or other close family members; the maker of the will should generally know and recognize his or her natural heirs.

Low Standards

This test of mental capacity is not a particularly high standard to meet. The Iowa Supreme Court declared:

“Ability to transact business, generally, is not essential to testamentary capacity. Advanced age, failure of memory, senile dementia not shown to render the testatrix of insufficient mental capacity to understand the nature of the act, to recollect the extent of her property and the natural objects of her bounty and their claims upon her, and to comprehend the manner in which she wishes her property distributed, childishness, mental weakness, and old age are not, of themselves, sufficient to deprive her of testamentary capacity.” Walters v. Heaton, 271 N.W. 310, 313 (Iowa 1937). (Note that the court’s decision was related to a female, hence the she/her, but, this standard undoubtedly applies to all will-makers in Iowa!)

Are you frightened to death of making a mistake with your will? Never fear! A qualified attorney can help guide you around the sticky spiderwebs and swamps of estate law. Email me at gordon@gordonfischerlawfirm.com or call me on my cell at 515-371-6077. I’d be happy to offer you a one-hour free consultation!

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Legal Phrase of the Day: “Heirs at Law”

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Heirs at law on beach

Before I explain the concept of “heirs at law,” you might be thinking, why even bring this up? Of what relevance is this “Ye Olde Sounding Phraise” in today’s modern world?

It’s important for me to share the concept of “heirs at law” with you, dear GoFisch blog Reader, for three reasons.

  1. It helps explain why I, and other estate planners, ask so many darn questions. We need lots of info.
  2. The concept of “heirs at law” shows that you need to be open and honest and forthcoming with me, or any estate planner. Without complete transparency and truth, the estate plan runs the risk of being useless (the idea of “garbage in, garbage out” applies here).
  3. “Heirs at law” is yet another reason that a DIY will, or using an online service to produce your will, is just a terrible idea. You need an estate plan crafted by a trusted professional, unique to your special needs. Every family is different, so there can be no “one-size-fits-all” estate plan, and there are many moving parts to a comprehensive estate plan.

With that established, what does the term “heirs at law” actually mean?

Heirs at law are those folks who would inherit your property in the event you died without a will, which is called intestacy.1 It is critically important to determine who the heirs at law are, even for people not subject to the laws of intestacy (i.e., folks who have a will) for two big reasons.

  1. Heirs at law must be notified of the probate process.
  2. Heirs at law are allowed to challenge the will in probate court.

All in the (sometimes complicated) family

As I already stated, it’s a wise idea to work with your estate planner and provide all the information requested. As a practical matter, the extent of information you’ll need to provide your estate planner regarding heirs at law depends of the nature of your family and relatives. For instance, in the case of two people, married only to each other, with children only from that one marriage—then the spouse and children (and perhaps grandchildren) will be the obvious heirs at law.

In another example, a family could also constitute a remarriage with each spouse having children from previous relationships. In this case, the stepchildren would need to be adopted by the applicable stepparent to be considered an heir at law.

In other situations, the client relatives may be much more distant, requiring more fact investigation. For example, take the case of a client who is unmarried and without children. In such a situation, the estate planner will need to pay close attention to identifying other relatives.

The Importance of Discussing Your Estate with Your Family

Of course, with an estate plan you can bequeath your estate to whomever you choose. You don’t have to give anything to any of your obvious or non-obvious heirs at law or any other relative for that matter. (In colloquial terms we could call this “stiffing your relatives.”) Although with that said, you cannot choose to disinherit a spouse.

This point reiterates why the estate planner should know and have updated contact information of who are the heirs at law. Again, it’s required that heirs at law be notified of probate process and these heirs (unlike a non-relative work colleague or neighbor) also have the legal standing to contest the will in court.

Avoid the Worst Case Scenario: Litigation over an Estate Plan

Another reason the estate planner must have knowledge of the heirs at law is to ward off fraudulent claims if need be. This reason is particularly important if the heirs at law are distant relatives. (An unfortunate real-world example of this involves Prince and the complicated intestate process following the singer’s passing without an estate plan.)

Bottom line: heirs at law are important when it comes to the distribution of your estate (with or without a will). Of course, dying intestate is NOT optimal and you DO need a will for a number of important reasons. I’d love to discuss the topic over the phone (515-371-6077) or via email. Don’t hesitate to contact me at any time!

[1] Bonus word! If an Iowan dies without a valid will, they die “intestate” and the laws of “intestate” succession are used to determine who will inherit the estate.

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Estate Planning Basics: What You Need to Know, but Were too Bored to Ask

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I KEEP six honest serving-men
(They taught me all I knew);
Their names are What and Why and When
And How and Where and Who.– Rudyard Kipling

I’ll use all six “serving men”—what, why, when, how, where, and who, albeit sometimes in slightly different order—to explain three broad topics: (1) estate planning; (2) trusts; and (3) business succession planning. If you’re unsure of any of the three topics listed, this is the blog post for you.

man taking notes in notebook

WHAT is an Estate Plan, Anyway?

What do we talk about when we talk about estate planning? There are six documents that should be part of everyone’s estate plan. Additionally, you should also keep these six documents updated and current. It’s also important you take note of assets with beneficiary designations (such as those on IRAs and bank accounts).

WHO Needs an Estate Plan? Everyone!

Everyone needs an estate plan. If you’re young, healthy, unmarried, have no children, and have no significant or unusual assets, perhaps you could talk me into the idea that you don’t entirely need an estate plan. Even in such exceedingly rare cases, I strongly recommend making sure your beneficiary designations are completed and up-to-date.

5 Reasons to Have an Estate Plan When You’re a Single Young Professional

For example, beneficiary designations can be found on your checking and savings accounts and on your retirement benefit plan. But, if you’re married, and/or have kids, and/or have significant or unusual assets, and/or own part or all of a business, you most definitely need an estate plan.

WHY Do You Need an Estate Plan?

Estate planning is not exactly material for scintillating conversation. In fact, I’d bet most of us like to avoid this topic because it can be confusing, and requires lots of decision-making. And, yes, it forces one to think about the mortality of loved ones and the self. Estate planning, after all, is a roadmap about what you want to happen after you move on from this life. While it may not be a fun topic, it is indeed a necessary one. If you die without an estate plan, there are several negative consequences.

Without an estate plan, you cannot choose who receives your estate assets.

If you die without a will, you leave the decision of who will receive your property, in what amount, and when up to the Iowa legislature and/or Iowa courts. With this situation, there is always the very real possibility that the distribution of your estate will be greatly different than if you had chosen it through an estate plan.

Without an estate plan, you cannot choose a guardian for your minor children.

If you die without an estate plan, Iowa courts will choose guardians for your children. One of the most important aspects of a will is that it allows you to designate who will be the guardian for your children. This can ensure that your children are cared for by the person that you want, not who the court chooses for you.

Without an estate plan, Iowa courts will choose your estate’s executor.

If you die without an estate plan, the probate court is forced to name an executor. The executor of your estate handles tasks like paying your creditors and distributing the rest of your assets to your heirs. If the probate court has to pick who will be your estate’s executor, there is always a chance that you would not have approved of that person if you had been alive. If you have an estate plan, your will names a trusted executor who will carry out all of your final wishes, pay your bills, and distribute your assets as you intended.

Without an estate plan, you can’t help your favorite nonprofits.

If you die without an estate plan, all your assets— house, savings, retirement plans, and so on—will pass to your heirs at law as specified under Iowa’s statutes. If you have an estate plan, you can include gifts to your favorite nonprofits and see that they are helped for many years to come.

HOW Do You Structure Your Estate Plan?

light bulb on post-it note

Again, there are six basic documents that should be part of everyone’s estate plan:

  1. Estate Planning Questionnaire
  2. Last will and testament
  3. Power of attorney for health care
  4. Power of attorney for finance
  5. Disposition of personal property
  6. Disposition of final remains

We’ll go through each document briefly, so you have a sense of what each entails.

Estate Planning Questionnaire

Estate planning involves facing heavy questions, and depending on the number of assets and beneficiaries you have, may take quite a bit of time and thought. I recommend clients (and even those who aren’t my clients) complete an Estate Plan Questionnaire. An Estate Plan Questionnaire is a simple way to get all of your information in one place and makes it easier for your attorney to build your estate plan.

As with any project, it helps “to begin with the end in mind.” A questionnaire can help get you there.

hand holding orb

Last Will and Testament

Now let’s discuss your last will and testament. In sum, you’ll be answering three major questions:

Q1. Who do you want to have your stuff?

This includes both tangible and intangible things. An example of a tangible item would be your coin collection. An example of an intangible asset would be stocks.

Q2. Who do you want to be in charge of carrying out your wishes as expressed in the will?

The “executor” is the person who will be responsible for making sure the will is carried out as written.

Q.3. If you have kids under age 18: who do you want to take care of your minor children?

You’ll want to designate a legal guardian(s) who will take care of your minor children until they are adults.

The Kids are Alright: Guardianship for Children

Power of Attorney for Health Care

A power of attorney (POA) for health care designates someone to handle your healthcare decisions for you if you become unable to make those decisions for yourself. A healthcare POA can govern any kind of decision that is related to your health that you want to address. A healthcare POA may include decisions related to organ donation, hospitalization, treatment in a nursing home, home health care, psychiatric treatment, and more.

For example, if you don’t want to be kept alive with machines, you can make this clear in your POA for healthcare. But, keep in mind your POA for health care isn’t just about end-of-life decisions, again, it can cover any medical situation.

Power of Attorney for Finance

The power of attorney for financial matters is similar to the health care document just discussed, only your designated agent has the power to make decisions and act on your behalf when it comes to your finances. This gives them the authority to pay bills, settle debts, sell property, or anything else that needs to be done if you become incapacitated and unable to do this yourself.

It might be obvious by now, but I’ll state it just in case: choosing an agent for a power of attorney requires that you think long and hard about who would be best suited for the job and who can be trusted.

woman on laptop on patio

Disposition of Personal Property

Now, let’s get to the disposition of the personal property. This is where you get specific about items you want particular people to have. If you’re leaving everything to one or two people, then you may not need to fill this out. But, if you know you want your niece Beth to have a specific piece of jewelry, and your cousin Karl to have that bookshelf he loved, then you’d say so in this document.

Disposition of Final Remains

The disposition of final remains document is where you get to tell your loved ones exactly how you want your body to be treated after you pass away. It can be as general as simply saying “I want to be cremated and scattered in my garden,” or it can be specific and include details of plots you’ve already purchased or arrangements you’ve already made.

Beneficiary Designations

Along with the six basic estate planning documents, don’t forget about your assets with beneficiary designations.

Common accounts with beneficiary designations include savings and checking accounts, life insurance, annuities, 401(k)s, pensions, and IRAs are all transferred via beneficiary designations. These beneficiary designations actually trump your will!

Regarding assets with beneficiary designations, you must make sure that designations are correctly filled out and supplied to the appropriate institution. Remember to keep these beneficiary designations updated and current.

6 Simple Tips for Beneficiary Designations

WHEN Do You Update Your Estate Plan?

Let’s say you’ve gone to an estate planning lawyer, and these six basic estate planning documents have been drafted and signed. What else? You need to keep these documents updated and current. If you undergo a major life event, you may well want to revisit with your estate planning lawyer, to see if this life event requires changing your estate planning documents.

What do I mean by a major life event? Some common events would include:

  • Selling or buying land
  • Birth or adoption of a child or grandchild
  • Marriage or divorce
  • Illness or disability of your spouse
  • Purchasing a home or other large asset
  • Moving to another state
  • Large increases or decreases in the value of assets, such as investments
  • If you or your spouse receives a large inheritance or gift
  • If any family member, or another heir, dies, becomes ill, or is incapacitated

This is just a short list of life events that should cause you to reconsider your estate plan. There are many others; if you think you might have undergone a major life event, check with your estate planning lawyer.

5 Scenarios for Estate Planning Revisions

WHERE Do You Keep Your Estate Plan?

You should store your estate planning documents in a safe place, such as a fireproof safe at home, or a safety-deposit box. Another option in our digital era is storage on the “cloud.” Just make sure the important agents under your estate plan—say, for example, the executor of your will, or power of attorney representative—can access the documents if and when the need arises. For most folks, that’s enough: the six documents, keeping the documents current and remembering about those assets with beneficiary designations.

Don’t Forget About Benefiting Charities!

Perhaps most importantly, through proper estate planning, you can help your favorite charities in ways large and small. One common way grantors elect to support the causes and organizations they care about is by naming them as a beneficiary of a certain amount or percentage of the estate’s assets.

YOU Are a Super Hero: Charitable Giving Through Estate Planning

Time for a Trust?

Wait a second…what do you mean by “for most folks, that’s enough?” Indeed, for most Iowans what I’ve outlined here is enough. There may be folks who have a high net worth, or who have complex assets (for example, more than one piece of real estate), or own part or all of a robust business, or otherwise have unusual situations. In such cases, a trust may be helpful. That’s considered more “advanced” estate planning and will mean additional conversations and collaboration on what estate planning tools work best for the situation.

Calling all Word Nerds: 9 Terms to Know About Trusts

See? That wasn’t so bad!

Whether it’s complicated or simple, it does require some thought and time. But, it’s worth the investment. A proper estate plan can save you and your estate costs and fees, help your family and friends, and provide you peace of mind.

Do you have an estate plan? Why or why not? I’d love to hear from you in the comments below. You can reach me at any time at 515-371-6077 or gordon@gordonfischerlawfirm.com.

Everyone has unique needs and thus every estate plan needs to be personalized. Online templates for estate plans won’t cover the nuances of your life, wishes, and assets. The best place to start on your personalized estate plan is with my Estate Planning Questionnaire.

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Think Estate Planning is Just for the Wealthy? Think Again!

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wealthy dollar bills

There is a rumor that has been floating around that only the rich need estate planning. That is extremely false. Everyone needs an estate plan, but the wealthy don’t need estate planning as much as the middle-class and working-class folks. If this contradicts everything you’ve ever thought about estate planning allow me to explain.

The Case of Kingston Lear

Suppose Kingston Lear (get it?!), a wealthy Iowan, decides he doesn’t need a qualified and experienced estate planner, he can do it himself, or use an online, one-size-fits-all service. Hey, Lear figures, this way he’s saving both time and money. Also, nothing is going to happen to him for a while, he can get around to doing a proper estate plan with a proper estate planning professional “someday.”

How Much Does an Estate Plan Cost?

Of course, “someday” never comes, but Lear’s death does. His three daughters are aghast that Lear has no real estate plan. The template resembling an estate plan is completely inadequate for the size and complexity of Lear’s assets.

A Matter of Trusts

Lear could have easily, with the help of a professional advisor, set up a trust (even a plain, “vanilla” revocable living trust would have worked) to avoid probate. But, the online service he used didn’t even explain the difference between wills and trusts. So, Lear’s assets all must go through probate. This means that the time and money Lear though he was saving is gone in a flash.

(Legal) Word of the Day: Trust

Probate Costs and Fees, If You Please

Probate fees are going to equate to at least 2% cut of Lear’s estate. Remember, Lear’s estate is large and complex and valued at $10 million, so the actual figure is probably going to be more like four percent.

Using 4% as the figure for probate fees means a loss of $40,000 ($10 million X .04 = $400,000). This is $400,000 that could have been passed down to his daughters through a trust, or split generously between his heirs and charitable organizations near and dear to Lear’s heart.

Also, court costs may amount to another 1%, or loss of $10,000 more ($10 million X .01 = $100,000).

Loss of Privacy

Another major benefit of a trust—again, not explained to Lear because didn’t seek any individualized advice—is privacy. A will (or most any document that goes through probate, absent very special circumstances) is simply a public document. Anyone can read, copy, share, and write about it.

Consider one of Lear’s major assets was an ongoing business—a Shakespearean-themed jousting complex, where families could have fun practicing jousting.

horses at fence

Unfortunately, in some of the probate papers, it was disclosed that there had been numerous complaints by the Iowa Horse Association about the treatment of horses. It isn’t long until this hits the blogs, and some of the more sensational aspects of the report (though hotly disputed) goes viral. The jousting park, which had been quite profitable, is now eschewed by all the good people of the area. The daughters are forced to sell the business asset to preserve the family’s good name (or what’s left of it) and sell at a loss. While the jousting park had been worth as much as $1 million, the daughters have to sell, so there’s a “paper loss,” but nonetheless less a loss, of another $900,000.

Loss of Future Profits

The $900,000 is a conservative figure; it doesn’t include lost future profits. If not for the scandal becoming public, who knows how long the jousting park could have remained really popular and this profitable. Years? Decades? It’s quite difficult to quantify, but it’s certainly probable that there are some lost profits. The question is: how much?

Costs of Cases

Because Lear’s will wasn’t drafted by professional, there are many ambiguities and loopholes. It’s not long before the three daughters begin fighting and, with unclear direction from their father, they wind up suing each other.

Taking a court case all the way to trial can easily mean $50,000 in attorney’s fees, plus each daughter will want and need her own attorney. So, another $150,000 is lost to attorney’s fees!

Avoid the Worst Case Scenario: Litigation over an Estate Plan

Total Losses Equal?

Lear could have had his estate plan done by an Iowa professional for a few thousand dollars. Instead, he lost a total far greater than that:

  • Probate Fees: $400,000
  • Probate Court Costs: $100,000
  • Loss on Sale of Jousting Park: $900,000
  • Loss of Future Profits of Jousting Park: Incalculable?
  • Attorney’s Fees for Daughters’ Litigation $150,000

This is a hit for the inheritance of $1.55 million, leaving $8.5 million (rounded up), or a little less than $3 million per daughter. But you know what? That still leaves an inheritance of $8.5 million to be split amongst three sisters.

The Rich Can Afford Bad Estate Planning

crown silver

Lear acted unwisely, arguably recklessly! A great deal of his money was wasted that could have been used for great charitable work in Iowa through local nonprofit organizations. But, for all his foolishness, Lear’s daughters still end up with $3 million each. Will the daughters incur much suffering with “only” $3 million? No.

That’s the rub; the rich can afford to make big (and small) estate planning mistakes.

You Can’t Afford Poor Quality Estate Planning

Let’s look at this from a normal Iowan perspective. At least 2% in probate costs and fees, a huge drop in value in a key asset, attorney’s fees for litigation…can a middle-class estate merely shrug these kinds of losses off? Not a chance.

The rich aren’t like you and me. They can badly botch estate planning. You and I can’t afford to make mistakes with our estates; there’s no room (and not enough money!) for error.

Need an estate plan but aren’t sure where to start? It’s easy from start to finish. Fill out my obligation-free Estate Plan Questionnaire or contact me.

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5 Celebrities Who Died Without a Will

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After Prince’s unfortunate death in 2016 the news featured a multitude of articles commemorating his life and artistic influence. After those headlines faded, a new piece of news emerged: the artist died without a will. His estate, estimated to be between $150-$300 million, went to probate in the state of Minnesota and the state court appointed a special administrator to parcel out what Prince actually owned, the value of the property, and whom will actually receive the assets.

Prince Died Without a Will: 4 Reasons YOU Need an Estate Plan

It’s a bad idea for anyone to die without an estate plan in place, as it leaves a great deal up to the law of intestate succession. Most people would prefer to choose their beneficiaries and a trusted executor to carry out their wishes. Under intestacy laws, you cannot choose these important people. You also cannot use your estate plan to achieve goals to reduce or eliminate income, estate, or inheritance taxes. Basically, without a will, you have no control over who gets what of your hard-earned assets at death.

Unfortunately, far too many people (six out of 10 Americans) don’t have estate planning documents like a will or living trust. Plus, since celebrities often have complex and highly valuable assets, dying intestate is often an extremely complicated, litigious affair. (For the sake of your friends, family, and lasting legacy avoiding litigation is a good goal to have with an estate plan.) For instance, a big question in the Prince case is who will be the beneficiary of perhaps one of the most persistently valuable assets—the right of publicity, which includes elements like Prince’s name and likeness.

Avoid the Worst Case Scenario: Litigation over an Estate Plan

While the average Iowan won’t have to consider publicity rights a part of their estate, there are at least six key documents celebs and the non-famous alike should have that cover important elements like finances, healthcare, and personal disposition of property.

Learn from Prince and these other five celebrities (among many more) who passed away without the proper estate planning in place:

  1. Howard Hughes, entrepreneur/producer/aviator

Hughes died on a flight in 1976 with no surviving spouse, child, parent, or sibling. Without a will, his $500 million-valued estate was eventually decided by a small Texas county probate court jury five years after his passing. The probate had brought about a “circus-like” atmosphere as more than 600 people showed up in person claiming to be “wives, sons, daughters, first, second, third, fourth and fifth cousins” of the late Hughes (and that didn’t count all the people who petitioned via letter). A couple of wills were also produced but were eventually thrown out as fakes.

The Howard Hughes Estate: A Cautionary Tale

  1. Amy Winehouse, singer/songwriter

The British artist died in 2011 when she was just 27. Without a will, her estate worth millions went to her parents. Say, even if Winehouse did want her brother to inherit part of the estate, he couldn’t because of (U.K.) laws covering who inherits what.

hollywood sign

  1. Tupac Shakur, rapper/actor

Shakur was tragically shot and killed in 1996 at the young age of 25; after his death, “his mother had to file court papers establishing herself as the administrator of his estate and the sole living heir.” Shakur also left a complex web of financial dealings, spendings, and debts to figure out. Shakur’s estate was made more complicated over the years through several albums of his music (intellectual property) released posthumously. Additionally, Tupac’s biological father lost a lawsuit claiming he was entitled to half of the estate.

  1. Pablo Picasso, artist

It took more than six years of “bitter negotiations” for Picasso’s estate to be settled (for a pricey $30 million) after he died in 1973. Picasso passed at the ripe old age of 91 but did so without a will, so his assets were divided amongst seven familiar heirs. Picasso left a massive amount of valuable assets including 45,000 works of art, five homes, $4.5 million cash, $1.3 in gold, stocks, and bonds. “In 1980 the Picasso estate was appraised at $250 million, but experts have said the true value was actually in the billions.”

5 Celebrities With Crazy Estate Plan Provisions

  1. Sonny Bono, singer/U.S. Representative

Bono passed away in 1998 following a fatal skiing accident with no will to his name. Issues flared when Cher (of their former pop duo Sonny & Cher) alleged he owned her past due alimony and a man named Sean Machu said he was Bono’s illegitimate child. His fourth spouse became the estate’s administrator.

microphone

  1.  Billie Holiday, jazz musician/singer

The famed singer’s estate at the time of her death stands as a paradox to her modern posthumous fame. When Holiday died in 1959 she had “$0.70 in the bank and $750 strapped to her leg.” Since she died intestate under New York state law all of her royalties went to her estranged husband Louis McKay. Her total estate only continued to grow after her death including four Grammy awards, a movie about her life starring Diana Ross, and induction into the Grammy Hall of Fame.

You, yes you, can be a star too, but you need to have an estate plan in place to protect your legacy. The best way to get started is with my free (no obligation) estate plan questionnaire. Or, contact me to discuss your individual situation. Shoot me an email at gordon@gordonfischerlawfirm.com or give me a call at 515-371-6077.

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4 Major Reasons YOU Need a Will

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Discussion of will and estate plan

Yes, YOU need a will. If you don’t have a will, it can cost your family and friends not only a lot of time and money, but also lots of anxiety and even heartache.

Here are four major (and certainly not the only) reasons wills are one of the most essential estate planning documents that you should most definitely have.

#1 Without a will, probate courts and the Iowa Legislature decide everything about your estate.

If you die without a will, you are leaving it up to the legislature/courts to decide who will receive your property. In some situations, even who will get to raise your children.

#2 Without a will, you cannot choose a guardian for your children.

You read that right. Without this essential estate planning document, the court will choose guardians for your children. One of the most important aspects of a will is that it allows you to designate who will be the guardian for minor children. This can ensure your children are cared for by the person that you want, not who the court chooses for you.

The Kids are Alright: Guardianship for Children

#3 Without a will, the probate court will choose your estate’s executor.

If you die without a will, the probate court is forced to name an executor. The executor of your estate handles tasks like paying your creditors and distributing the rest of your assets to your heirs. Of course, if the probate court has to pick who will be your estate’s executor there is always a possibility that you would not have approved of that person if you had been alive.

However, if you have this ever important document, it will name an executor who will be responsible for carrying out all of your final wishes, pay your bills, and distribute your assets just as you wanted.

Couple sitting on bench talking about will

#4 Without a will, you can’t give your favorite nonprofits charitable gifts from your estate.

If you die without a will, your estate assets—your house, savings, automobiles, property—will pass to your heirs under Iowa’s statute. This excludes you from the enormous potential to do good by donating charitable gifts to your favorite nonprofits in your will. Testamentary gifts can help ensure causes you care about are supported well into the future.

Do you have a will? Why or why not? I’d love to hear from you in the comments below.

For Iowans looking for a place to start their estate planning, check out my estate plan questionnaire. It’s free, and provided to you without any obligation. I’m also happy to discuss your individual situation to help determine what estate planning tools are best for you. Reach out via email or phone at any time.

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Young People Should Be the Most Concerned with Estate Planning

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Young couple holding hands

So, WHO needs an estate plan, anyway?

Who needs to be most concerned with estate planning? What age group? Ask Iowans this question, and I’ll bet most would conjure up the image of a retiree who just spent 50+ years working hard to acquire significant assets. Of course, it’s important for this demographic to have a quality estate plan, that’s fairly obvious.

But, imagine a young, married couple. They both have good jobs, live in a fine starter home, and have a baby.

 

crying newborn baby

This young couple tries to put away a little bit of money for savings, in a 529 college fund, and for retirement. Why should they worry about estate planning?

The truth is, this young couple should be just as concerned–arguably, even more concerned–with estate planning as the retiree.

Here are four reasons why:

  • Choosing guardians for minor children. In an estate plan, you can choose the guardians of minor children (e.g., children under age 18). If you should become incapacitated, or even die without any estate plan, an Iowa court would have no choice but to appoint a guardian for your children – but it may not be who you wanted or would have chosen. Better to have plenty of time to consider and make a careful, well-reasoned choice.

Show Your Kids You Love ‘Em with a Testamentary Trust

  • Save on fees, court costs, and taxes. A good estate plan can save you and your estate money on fees, court costs, and taxes. These savings can be even more critically important for a smaller estate (more likely when you’re younger), than for larger estate (more likely as you grow older). Often, young folks actually have the greatest need to save money to pass along the greatest amount they possibly can to family and loved ones.

 

  • Help favorite charities. Having an estate plan means that you can put into place immensely helpful donations for your favorite charities. Without an estate plan there’s no opportunity for you to help your favorite charities

Let’s Head Back to School! First Lesson is on Planned Giving

  • Life is uncertain. It may be awkward to talk about, but life isn’t guaranteed for any of us, young or old. There’s an old saying in estate planning circles that goes, “People don’t always die when they are supposed to.” Wives usually outlive their husbands, parents usually outlive their children, and so on, but not always. It is best to be prepared for anything and everything.

 

Mom and daughter hugging

Who should be most concerned with estate planning? I actually think young people should be!

Whatever your age, if you are interested in estate planning (as everyone should want to check it off their list), a good place to start is my free Estate Planning Questionnaire. Questions? Want to discuss you personal situation? Contact me for a free consult!

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5 Scenarios for Estate Planning Revisions

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Estate planning revisions

You have an estate plan? High five! You are already better off than most of your fellow citizens. In fact, numerous surveys have shown that about half of adult Americans do not even have a basic will. So, kudos to you if you’ve already knocked out this major life decision and planning initiative. If you already have a will, there are at least five major scenarios in which you should revisit and make changes accordingly:

  1. Moving out-of-state or out-of-country. What makes a will legal and valid in Iowa is not the same in other states, like, say, Ohio or Rhode Island. Each state has its own set of laws governing wills, probate, and so on. Also, if you buy property in another state and/or set-up a secondary residence, this must be included in your estate plan.
  2. If something happens to one of your beneficiaries or fiduciaries. Life happens to everyone else in your plan, and sometimes this means beneficiary passes away or a fiduciary retires. Reviewing your plan’s key contact list at least annually, in addition to on an as-needed basis, will keep everything fresh and relevant.
  3. If your marriage status changes. Needless to say, you will want to update your estate plan in the case of a marriage or divorce. Most estate planners you’ll meet can attest to horror stories on behalf of their clients of what happens when an ex-spouse inherits a huge sum of money, merely because an estate plan wasn’t properly updated.
  4. If you have kids (or more kids). You’ll want to ensure that in case something happens to you that your children are going to be protected by a trusted guardian. And, also, presumably you’ll want to add the children as beneficiaries, etc.
  5. If your financial situation changes significantly. This includes inheriting money or complex assets. Perhaps your business accelerates astronomically. Maybe you have what professional advisors call “a liquidity event,” (e.g., you’re flush with cash). Your estate plan, and its distributions, will need to be revisited to accommodate such changes in fortune.

Back to School: Political Science- How Changes to Legislation Impact Your Estate Plan

This, however, is just the tip of the iceberg! While your estate plan never expires, many other situations involving shifts in personal/financial goals, changes in needs (such as deciding you need a trust instead of just a basic estate plan), and even changes to legislation can mean estate planning revisions.

Have questions? Need more information?

If you think you may need to revise your estate plan and would like a free consult feel free to reach out at any time! You can contact me by email at Gordon@gordonfischerlawfirm.com or give me a call at 515-371-6077.

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August is National Make-A-Will Month

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August includes it’s fair share of obscure “holidays” including National Catfish Month, Friendship Week, and Bad Poetry Day. This month is also your chance to celebrate National Make-A-Will Month! (Yes, seriously. This is a thing.) I recommend celebrating this quite literal month by creating an estate plan. A will is one of six key documents in a quality, individualized estate plan. (If you were to elect to make a living revocable trust a part of your plan, then you would still need a will—often referred to as a pour-over will—it would just read a little different!)

national make-a-will month

Depending on your personal/family situation and assets, a will can be a bit more complicated and longer in page length than the other estate plan documents. It’s important you work with a lawyer experienced in estate planning to be sure your will covers the three major questions of:

  1. Who do you want to be the executor of your will? The executor is in charge of carrying out your directions and wishes as expressed in the will. They will also pay any outstanding debts and distribute assets as you express in the document.
  2. Who do you want to be the legal guardians for your minor children until they’re adults (age 18), if something were happen to you?
  3. What do you want done with both your tangible and intangible property? (An example of tangible property is your books or your boat. Intangible property includes assets like stocks.)

Yet another reason to work with a professional estate planner to craft a will is to avoid costly mistakes and to legitimately donate to your favorite charities.

YOU Are a Super Hero: Charitable Giving Through Estate Planning

Why Does a Will Matter?

I cannot reinforce enough that everyone NEEDS a will. Leaving your family and friends without a clearly written will in place can result in worst case scenarios such as litigation or confusion in who is to be the proper guardian of your minor child(ren). Real world examples of this are unfortunately all too common and no one is immune. For instance, Prince died without a will leaving family infighting and conflict.

Think Estate Planning is Just for the Wealthy? Think Again!

Without a will the Iowa probate court is forced to name an executor and there is the possibility that the appointed executor is not who you would have chosen. It’s simply better not to gamble with who has control over dispersing your hard earned assets.

Regular Revisions

If you already have a will (and other necessary estate planning documents) congrats! You’re better prepared for the inevitable than about half of Americans. Yet, just because you created an estate plan at one point doesn’t mean it automatically adapts to how your life changes.

While estate plans never expire, for your will to be most effective it needs to be reviewed at least annually and updated as needed. Common scenarios for estate plan revisions can be a death in the family, change in marriage status, birth of a child, major changes in financial situation, and moving out of state.

5 Scenarios for Estate Planning Revisions

Your estate plan should also be updated if your goals change over time. For example, you may want to alter the amounts of inheritance or increase/decrease charitable bequests.

Where There’s a Will There’s a Way

I would love to help you solidify your family’s future, help you achieve peace of mind, and celebrate Make-A-Will Month in the best way you can! The best place to start is by filling out my Estate Plan Questionnaire. It’s easy, free, and there’s no obligation. It’s simply a document that gets you thinking and planning. You can also contact me at any time via email (Gordon@gordonfischerlawfirm.com) or phone 515-371-6077.

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