Thoughtful Estate Planning
When Kobe Bryant died in a Los Angeles-area plane crash in February 2020, the Lakers legend was happily married to his wife, Vanessa, of nearly 20 years. He was also worth approximately $600M. As a result, Bryant had a detailed estate plan, which safeguarded his assets, mitigated tax liability, and carefully considered his family’s bequests. But even with such meticulous planning, even Bryant’s estate plan was not devoid of oversights and snags. Bryant failed to update his will following the birth of his youngest daughter, and he excluded his mother-in-law, with whom a verbal agreement had long been in place. The former mistake led to a lengthy legal process, the latter caused a family dispute, and both became public. What appeared to be a tightly-drawn estate plan still had flaws. Imagine a $600M estate with no plan at all.
Your estate might not be worth hundreds of millions, but it is worth something, and it’s certainly worth a thoughtful and comprehensive estate plan. To properly complete your estate planning, it’s imperative to understand that your estate comprises everything you own, from real property, land, and vehicles, to cash, bank accounts, investments, furnishings, collectibles, and intellectual property of any kind. Once you identify each element of your estate, build and follow a checklist to ensure nothing is forgotten. Specifically, it is critical to establish a power of attorney during your lifetime and an executor of your estate, and to understand how they are different. A power of attorney (“POA”) is one who is granted the power to act on your behalf, or who speaks and acts on behalf of an incapacitated person. Your POA, however, is legally powerless upon your death. At this point, the executor assumes control and, once approved by a probate court, sees that your Will is carried out. If you fail to name an executor, a probate court selects an administrator of your estate based on state law. While the court intends to be reasonable in its appointment, the fact of the matter is that the decision becomes somebody else’s.
Probate, which is a lengthy and often complicated court process that validates both your will and your executor in order to make the bequests in your Will and close your estate, is made even more strenuous if a Will is left incomplete. This is also the process during which your Will can be contested. In either of these cases, the court will review assets and determine a course of action for any element of the estate or beneficiary not accounted for. Again, in this particular process, the decision becomes potentially problematic. Such was the case in Bryant’s untimely death.
To ensure a seamless process, you may want to inform your loved ones of what they can expect of your estate, and review your Will with them. Of course, keeping any or everything confidential is certainly your right, and may be necessary is a given situation, but when it comes to thoughtful estate planning, communication before it’s too late can make all the difference. If a power of attorney, executor, and other close family members are in the know, even the smallest oversights, like Kobe Bryant’s, can be avoided.