ESTATE PLANNING NEWS & ARTICLES
The Law of Unintended Consequences
Just before the holidays we shared a post about Muhammad Ali’s son from online source Meaww.com. The report claimed he “is ‘penniless’ and ‘has no plans for Christmas’ except looking for odd jobs.” The article went on to explain that the late heavyweight champion’s son had expected to inherit $5 million after the boxing legend passed away at the age of 74 in 2016, but Ali’s remarriage put a wrench in it. This is probably a classic case of the unintended consequences of estate planning.
Blended Family Breakdown
Muhammad Ali Jr. had apparently expected “to get a share of his father’s $60 million estate with the boxer’s fourth wife Lonnie, seven daughters and adopted son Assad.” However, he and Lonnie must apparently no longer see eye-to-eye. “Lonnie used her power of attorney over the fortune and is also believed to have helped write the legend’s will before his death. As per Junior, the Muhammad Ali Estate provides him only $1,000 a month, of which $700 is for rent. Not having a bank account doesn’t work in his favor either as he has to pay commission to cash the cheques. It leaves him with just $200 a month – or $6 a day – after bills,” explains the article posted last December.
This public story is a prime example of how sometimes estate planning (or the lack thereof) has unintended consequences for those left behind. In some cases, a well-meaning parent can create disincentives for their children/heirs to become productive members of society. Other times, poor or lack of planning goes against the intentions of the deceased and the heir is left struggling, sidelined by a new spouse or other blended family member.
Get a Trust for Special Needs Heirs
In the case of special needs heirs, too much of inheritance can cause big problems with receiving much needed public benefits. In this case, a proper estate plan would include a trust that would mitigate those issues. Learn more HERE.
Don’t Gamble with DIY Planning
The biggest lesson of all really is that this is exactly why DIY estate planning can be such a gamble for folks. You really don’t know what you don’t know. So I urge you to seek out professional advice especially if you are remarried with kids, have a special needs family members and or other similar issues. We would be happy to help you navigate your situation to be sure your wishes are carried out properly and there are no surprises that directly impact a beloved family member with unintended consequences.