Fall – 2021
Hello and welcome to the Fall edition of Haider’s Hits – a seasonal blog post with timely insights to help you Invest with Clarity and Live with Purpose.
Before we find out what mistakes to avoid, here’s what I’m watching in the markets and the economy.
- The Omicron variant made a splash on Black Friday. There’s still a lot we don’t know about it. We’re keeping an eye on how this could impact market fundamentals – that is – corporate earnings which ultimately drives market prices.
- We just had third quarter earnings reports and corporate profits have been coming in fairly strong even though economic growth slowed in the quarter. Because growth in the economy is an important variable in corporate profits, we’ll be watching this relationship pretty closely especially in light of the new variant.
- If you’d like more information on how these things are impacting your financial plan, please feel free to reach out to schedule a call.
Ok, so now let me ask you this. What is something you could have in common with the rockstar Prince, Supreme Court Chief Justice Warren Burger, or actor Heath Ledger?? The answer… costly mistakes in your estate plan.
Now when many people hear “estate planning,” they think that’s just for the rich and famous. But I can tell you, everybody needs an estate plan, or even a basic will. The lack of proper planning could make you have a lot more in common with these celebrities than you think. Their mistakes deeply affected their families and forced the courts to get involved.
Let’s take a look at their estate planning mistakes and see what we can learn.
First, there’s Prince who died at the age of 57 and to everybody’s surprise, he had no will or estate plan at all! Now a Minnesota judge is deciding how to distribute his $300million estate. To this day six siblings including other potential heirs are fighting for a claim. Even though preparing a will is a basic step, author Andrew Mayoras of Trial & Heirs says, “it’s estimated that 60 percent to two-thirds of adults in America don’t have a last will and testament, so Prince isn’t alone.” Just know, if you die without a plan, the courts will determine who gets what. Don’t make that mistake.
The second mistake we can avoid is trying to do it ourselves. Writing a will DIY won’t cost you much, and there are plenty of online options, but I like to say, “You don’t know what you don’t know.” If you don’t know the right questions to ask your will may not have the proper language to avoid the worst. Look at Chief Justice Warren Burger who died with a $1.8 million estate and a will of 176 words he typed up himself. If anybody should have gotten right, it was certainly him, but unfortunately, he was missing important language that cost his family $450,000 in taxes and court fees. Saving money on the front end could be costly to your estate if your plan isn’t up to snuff to all the state laws or tax laws.
Finally, don’t forget to keep your beneficiaries updated like the mistake the actor from the Batman movie, Heath Ledger made. He failed to update his will after the birth of his daughter and when he passed at the age of 28, all of his assets went to his dad causing a lot of family discord. Even more importantly, make sure your retirement accounts are updated to match your will or else your life-long savings could end up with somebody you never wanted.
No doubt, estate planning can be complex, and much will depend on your specific situation.
Mistakes can lead to costly consequences that could have easily been avoided with some simple planning. That said, we’d be happy to entertain any questions you have or point you in the direction of an experienced estate planning attorney.
Thanks for joining me today. Please remember to pass this along to your friends and family and I look forward to sharing more in the next edition of Haider’s Hits.
