Celebrity estate planning mistakes can be cautionary tales
There was a time, not so long ago, that one of the biggest names and biggest voices in pop music belonged to Whitney Houston. In early 2012, Ms. Houston died at the young age of 48. She was found in a bathtub and had illegal drugs in her system. In some ways, Houston was a victim of her own success.
She left behind an 18-year-old daughter and an estate worth about $20 million. Six months ago, Bobbi Kristina Brown was also found unresponsive in a bathtub just like her mother and near the anniversary of her mother’s death. She never woke up and died earlier this month at age 22. While the situation surrounding her untimely death is complex, some are now saying that the estate planning her mother had done (and failed to do) could have been a contributing factor to unhealthy choices Ms. Brown made in the final years of her life.
According to news sources, Whitney Houston drafted her will while pregnant with Bobbi Kristina and hadn’t really updated it since that time. Her assets were not left to Bobbi Kristina in a specific trust but rather in a general one set up for any and all of Houston’s future children. BK received 10 percent of the inheritance at age 21, was scheduled to receive more at age 25 and would have inherited everything by age 30.
If Ms. Houston had lived, she might have wanted to give her daughter the inheritance more slowly to avoid the problems associated with “too much, too young.” If there had been a revocable living trust in place, there may have been limits on when the money was doled out and under what circumstances.
Obviously, we cannot know all of the factors at play in this tragic case. But this situation can nonetheless serve as a valuable lesson about the importance of creating and regularly updating an estate plan. We each want to ensure that our loved ones are cared for when we are gone, but leaving behind an inheritance with few distribution provisions is not always the best way to achieve that goal.