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Apr 20, 2018

Fascinating Prince Estate Update

Growing up the youngest of four boys, I learned a lot from my brothers and followed their lead in many ways. Every Saturday morning, all of us would wolf down Dad’s pancakes and bacon and immediately head out to the garage. The garage door would swing open to reveal the holy grail of our childhood – the ping pong table. About 20 or so of our neighborhood pals would invariably be waiting outside for the ping pong wars to begin.

Imagine something like this:

It was in that garage where I soaked it all up; my older brothers and their friends talking smack to each other, cranking the music on the boombox (remember those?) and studying the ping pong techniques. Nobody could beat my brother John and his wicked spin game.

There was always fighting over the music playlist. And it was much harder back then to switch up the tunes because you had to pull out the cassette tape and pop in another one and fast forward or rewind the thing. Then the tape would get tangled and you would have to wind it back together by using your finger in the hole of the cassette. Ridiculous!

There was a lot of great music being played on those Saturdays in our garage; the Stones, Creedence Clearwater Revival, the Who, Journey, Stix, Three Dog Night, Bowie and Prince. It’s my memory of those dog days of summer and the music that has me thinking in particular about Prince. This Prince,

Of course you remember that Prince passed away back in 2016. And he did not have a will in place. I put out a blog at the time of his death about the importance of having your will and trust in place and the bumpy path Prince’s family was about to experience. So now where do things stand with the Prince estate? Here is some of what has happened.

First of all, Prince’s beneficiaries have received ZERO dollars from his estate. Yet the estate is bleeding cash, at times more than $600,000 a month! Comerica is managing the estate and getting paid over $125,000 per month. Law firm fees are in the neighborhood of $440,000 per month. Ouch!! Law firms and administrators have racked up over $6 million in fees so far. And family members are fighting and living in a courtroom.

So the elephant in the room here is, “make sure your planning is buttoned up.” I know what you are probably thinking. That you are not Prince with his multi-millions so you don’t have to put too much stock into your planning. But you don’t have to be worth millions for all of this to impact you. It’s really important if you are worth millions, but estate planning is important for all of us.

Let me give you an example. One group we do a ton of work for is business entrepreneurs. You may be one yourself or surely you have friends or family who fit the script. These entrepreneurs are great innovators and they are also risk takers. Not surprisingly, many entrepreneurs take a lot of risk when it comes to protecting their business. They rely on insurance, savings (or VC money) and luck to guard the business.

The problem with this formula is that it’s too fragile. If you are an entrepreneur, or even if you are not, you know that your family depends on your business (or your job) and your success. Losing a business or getting financially nailed by unexpected events can cause severe emotional and financial hardship.

Tools like insurance are a good first line of defense against an unforeseen calamity, but insurance is not the catch-all you think it is. Proper estate and asset protection planning needs to be part of your business plan.

Consider these amazing stats:

  • 80% of entrepreneurs don’t have a financial power of attorney in place.
  • Only 24% have a will.
  • Only 13% have a living trust.
  • 60% have zero planning in place.
A component of your big picture business plan has to account for the life issues that estate and asset protection planning address. What happens to your business or career if you have a really serious health issue? Or you are no longer around due to early retirement or death? Or you or your business get hit with a devastating lawsuit? (BTW, about 40 million lawsuits filed in the U.S. each year)

Will you and your business be OK? If you don’t know the answer, then perhaps it’s a good idea to make sure your planning is pulled together. I put together a short and powerful video on a few of the critically important components of your planning that you absolutely must understand.

Check it out just below and while you are viewing the video, be sure to click on the button to subscribe to our channel so I can ping you when we put out a new fresh video on the hot topics that impact you, your business and your family.

We made this video short, fun and with catchy music!
One last really important item and it has to do with the maintenance of your legal entities. If you have any legal entities at all such as LLC’s or Corporations, then you know how important it is to stay in compliance.

If you miss a filing requirement, a payment or don’t respond to mail from the Secretary of State or taxing authorities, then you could get nailed big time with fees and penalties. And if you get sued when you are out of compliance, not good!

Our corporate department will do a FREE audit of your legal entities to determine where things stand for you when it comes to compliance. And you can learn about our maintenance program that is very easy to initiate and keeps you in good standing at all times. Click below to learn more:

Thanks for checking out this weeks blog and don’t ever hesitate to book a call with me to learn more about our resources.
 
Thanks,

Paul

Paul Hitchcock

Director of Business Development
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