Lessons from Sopranos Star James Gandolfini’s Estate Plan

Learn From the Expensive Mistakes & Smart Decisions Made By Sopranos Actor James Gandolfini In Planning for His Estate

James Gandolfini, the actor best known for his portrayal of Tony Soprano on HBO’s The Sopranos, died suddenly last month while on vacation in Italy.  His will is already on the Internet, available for everyone to read!  Thus, the first lesson we should all take away from what he did and did not do right in his estate plan –  establishing a trust keeps your private estate and financial matters private!

Estate planning attorney Julie Garber, who writes a column on Wills & Estate Planning on About.com, lists 5 other estate planning lessons learned from James Gandolfini:

Lifetime trusts are often better for beneficiaries.  James Gandolfini’s 13-year-old son and infant daughter will inherit a large portion each of the actor’s estimated $70 million estate once they reach the age of 21.  It may have been better to establish lifetime trusts for each of the children, then making them co-trustees at 25 or 30, then sole trustees at the more mature age of 35 or 40.  This would have protected their inherited assets for life, from creditors, bankruptcy, lawsuits and divorce.

If you own foreign real estate, you need a foreign estate plan.  James Gandolfini owned property in Italy, which his will specified should be turned over to his children.  However, Italy has forced heirship laws that may trump the will.  He should have consulted with an Italian attorney and had an Italian will drawn that passes the property in accordance with Italian law.

Update your will regularly.  James Gandolfini had updated his will just six months prior to his death, and a few months following the birth of his daughter.  By taking action to update his will following the new birth, he saved his heirs a lot of headaches and heartaches. But unfortunately, he missed a big one — he didn’t update for estate taxes.

Irrevocable Life Insurance Trusts are a smart move.  James Gandolfini established an ILIT for his son Michael and funded it with a $7 million life insurance policy.  By setting up an ILIT, the proceeds from the insurance policy flow directly to the trust, with no New York or federal estate taxes on the $7 million.

Multiple executors and trustees can provide necessary checks and balances.  James Gandolfini had two children with two different wives.  He named his sister, his current wife and one of his attorneys as co-executors of his will and co-trustees of the testamentary trusts set up in his will, which was a savvy move to prevent any one beneficiary from being favored.

The one thing that Gandolfini and his lawyers did not think about enough was his estate taxes.  He’ll owe nearly $30,000,000 in estate taxes and much of it could have been avoided with good planning in advance.

As a Personal Family Lawyer®, I can further advise you on all your options and make things as easy as possible for your family during a Family Wealth Planning Session.  If you would like to have a talk about estate planning for your family, call our office today at 720-625-6597 to schedule a time for us to sit down and talk.

How to Ensure Your Life Insurance Benefits Go To Your Heir

 

Recently, 11 major life insurance companies agreed to pay $763 million to the heirs of deceased policyholders after it was discovered the companies continued billing customers for their policies even after they were dead.

This agreement is the second in the last two years to be reached with insurance companies, which had previously agreed to provide restitution and do a much better job of locating beneficiaries after being sued by the attorneys general of several states for not paying out benefits to the heirs of deceased policyholders.

This pattern seems to indicate that we all need to do a better job to ensure that the life insurance benefits we pay out come back to our heirs, or named beneficiaries, in the way we intend.  Here are 5 tips for making sure those you intended benefit from your life insurance:

Be truthful in your application.  If you have not been completely forthcoming about a major medical issue or your health habits (smoking, drinking, etc.) in your application for a life insurance policy, that policy could be declared null and void and your heirs or beneficiaries would be out of luck.

Don’t let it lapse.  If your family is counting on life insurance benefits to pay the bills if something should happen to you, and you have not been paying the bills for the policy, your family is left unprotected.  If you are having trouble paying a more expensive whole life policy, consider exploring a less expensive term policy.

Have a beneficiary bench.  Having a beneficiary on your policy who dies before you do is a recipe for disaster – and it happens much more than you think.  Designate a secondary as well as a final beneficiary for your life insurance benefits, and update them as the need arises. We recommend naming your trust as the beneficiary of your life insurance benefits, rather than naming an individual or even series of individuals.

Play it safe.  If you die because you engaged in risky behavior (not covered by the policy) – or you take your own life – your heirs or beneficiaries will likely receive back only what you paid in premiums, and not the full value of your policy.

Talk about it.  The primary reason that a vast majority of potential beneficiaries never see a dime in life insurance benefits is because policies were lost or misplaced and family members were never told of their existence in the first place.  So if you have a life insurance policy, let your family know.  And ask them if they have one, too.

If you do planning with our firm, we prepare a Family Wealth Inventory (and keep it updated annually) for all of our clients.  Give us a call at 720-248-7621 if you’d like us to help you with this too and ensure your family never loses track of any of your assets after you are gone.

Best Mother’s Day Gift Ever? The Kids Protection Planning Kit

Best Mother’s Day Gift Ever?  The Kids Protection Planning Kit®

By now, the flood of floral commercials has already reminded us that Mother’s Day is this Sunday, May 12.  But before you plunk down hard earned cash on something that will wilt and die in a week or so, consider a gift that is truly priceless: a plan for your kids (or grandkids) that provides Mom with the peace of mind that if anything should happen to her (or both of you), her children will always be in the care of  people she knows, loves and trusts.

We all hate to think that something could happen to us, but we know it happens to others like us every day.

We’ve all seen the news stories of moms and dads who leave their children with a babysitter, get into a terrible accident and don’t make it home.

The babysitter calls and calls, but there is no one to answer. The police are summoned and the children have to be placed with Child Protective Services. It’s one of a parent’s worst fears.

We’ve seen the stories of children placed in the care of people they barely know just because they are related by blood since there was no plan in place that dictated who would take on this incredible responsibility.

And we have seen the fall out of family fights created when mom and dad didn’t make a plan and the family couldn’t agree on what would happen.  Or in the worst case, what happens when there is no family available.

In all of these cases, it’s left up to a judge to decide when mom and dad don’t.

We know you don’t want this for your children (or grandchildren, nieces or nephews).  And this is where a Kids Protection Plan® can ensure it never does. Not for your kids.

Developed by nationally recognized attorney Alexis Neely, who is a mom herself, the Kids Protection Plan® provides Moms (and Dads) with the legal planning tools you need to make sure there is never a question about who will take care of your kids if you are in an accident.  The plan includes:

  • Legal documents to name short-term guardians who can be there immediately for your children so they’ll never be taken into the arms of strangers or anyone you wouldn’t want. Not even for a moment.
  • Letters to the people you name as short-term guardians so the people you’ve named will know just what to do if called upon.
  • Instructions to everyone who takes care of your kids as to exactly what to do if you are in an accident … so there’s never any question about who to call.
  • Legal documents to name long-term guardians who will raise your children just as you would so there is no family feuding over your children.
  • Letters to your long-term guardians letting them know what to do if called upon.
  • Instructions and guidelines for your long-term guardians on how you want your kids to be raised…make sure your kids are raised with your values, insights, stories and experience.
  • Delegations of Power and/or Medical powers of attorney for your minor children so the next time they travel without you or you travel without them, you know they’ll get the medical care they need.
  • A custom, personalized I.D. card for your wallet stating that you have minor children at home and who should be contacted if you are in an accident.

As a Personal Family Lawyer®, I am one of a small group of lawyers licensed to prepare a Kids Protection Plan® for your family and if you do not have one in place already for your children (or know a mom who doesn’t), this Mother’s Day is the perfect time to gift this plan to your family.

We include a Kids Protection Plan® with all the planning we do for the lucky families with children at home who plan with our office.  This month, in honor of Mother’s Day, we’ll be preparing stand-alone Kids Protection Plans for families who need them if you are one of the first five families to get on our calendar.  Mention this post when you call 720-248-7621 to schedule your appointment.

PS – The nationally-recognized attorney who created the Kids Protection Plan® is appearing on the Don’t Sweat the Small Stuff for Mom’s Summit, you may enjoy listening in. Here’s the link: www.personalfamilylawyer.com/momsconf