Many of us do not go about our estate planning the way celebrities do. After all, the rich and famous generally have more assets and immense wealth to account for. Their high-profile nature also requires them to protect their estate all the more.
But some experts say that when you look closely, the problems that celebrities and their families run into during the estate planning process are common among everyone. We saw a dose of this when now-deceased singer Michael Jackson chose his aging mother to be the guardian of his children when he died. He named world-renowned pop singer Diana Ross as a backup. Some might say he botched this decision. If his mother passes away before his kids reach the age of 18, they will have to relocate and live with an unrelated stranger.
In fact, celebrities often slip up in their estate planning, and we can learn from those mistakes and avoid similar ones in our own lives. Like Jackson, many choose an unsuitable guardian for their children. The most appropriate choices would be guardians who would be capable of raising the children all the way to adulthood.
Like the rest of us, celebrities get divorced and remarried and their families can change dramatically. They do not always update their estate plan accordingly, which leaves a whole web of people fighting over assets. Loaded with assets, celebrities usually have their piles of money scattered all across the board, which makes for an unorganized estate plan. It is best to keep close tabs on everything so everything can be figured into the proceedings.
Finally, celebrities often appoint an executor of an estate with a conflict of interest, such as a family member. Usually, you will want to appoint an objective individual outside of the proceedings to call the shots. Otherwise, family and loved ones can potentially bicker throughout the process and toss around allegations that may tarnish your reputation even after you have passed on.
Source: U.S. News - Money, "6 celebrity estate planning errors--and tips," Dec. 6, 2011