This week's Wealth Bestfriend topic: Chadwick Boseman
The news of our hero's passing shocked the world. I know it knocked me off my feet. I was sad and devasted. Chadwick Boseman had done so many wonderful things for our community and made sure that we knew important people in black culture through his roles portraying Jackie Robinson in 42 (2013), James Brown in Get on Up (2014), and Thurgood Marshall in Marshall (2017). Although, he is probably best known for his portrayal of T'Challa / Black Panther in the Marvel Cinematic Universe from 2016 to 2019, particularly in Black Panther (2018).
Boseman was a legend who will be missed. He died August 28, 2020, from complications due to colon cancer. Leaving his wife, parents, and thousands of mourning fans. But he didn't leave a will.
I won't say he didn't leave a trust because I still hold out hope that Boseman had a trust that is governing any other assets he had!
What Dying "Intestate" means
When you pass away without a trust or leave more than $166,250 (adjusted annually for inflation) with or without a will, your estate will be subject to the state probate court.
In Boseman's case, his estate will be probated because probate petitions filed by Boseman's widow state his estate is valued at $938,500. This estimated value includes any cash, personal property, real estate, business interest, investments, personal bank accounts & belongings in his name and EXCLUDES life insurance, retirement accounts, assets in living trust.
Since there isn't a will and there are still assets in his "estate" (think of this as anything in his name), the estate will be governed by California law. Meaning Boseman's estate will pass via the legal "default rules" the legislature has put in place when someone declines or fails to leave a written account of their wishes to be followed.
Default Rules Aren't Meant To Achieve YOUR Goals
Under California law, Boseman’s surviving spouse is entitled to inherit his estate. When a California resident dies with a surviving spouse and no children, California law provides that the surviving spouse inherits all community property and separate property. I'm sure he and his widow knew this, but what most don't know about is the FEES.
Of the $938,500 value placed on the estate, court fees, taxes, and attorney's fees are likely to eat away at this number.
In California, the probate code sets a statutory fee for attorneys and personal representatives (executor) for the administration of a decedent’s estate. Additionally, the attorney and personal representative may request and be permitted by the court to receive an amount above this standard fee if extraordinary services are performed.
So hypothetically, if Boseman's widow hired an attorney and they filed the petition for her, that attorney would be entitled to almost $22,000. Then if the court does not appoint Boseman's widow as the administrator of the estate, the estate will likely pay another $22,000 to the administrator they appoint. $44,000 gone just like that!
That's $44,000 that could have been saved by speaking with an estate planning attorney, paying a flat fee, and getting your estate plan set up. Most of an estate planner's job is to make sure your assets are in trust or transferred in a way to avoid probate (like using your beneficiary designations! In case you didn't catch that, it was Free Tip from your Wealth Bestfriend!).
I'm not even going to mention that there is a notice period to all potential creditors who love to come out of the shadows saying that the person who passed away owed them money! If anyone makes a valid claim there goes more money.
Let's just make sure we have a full estate plan and do our part to allow our loved ones to properly grieve. Having your plan ready to go allows the people that love you to process their grief and face their new reality that you won't be here with them anymore, uninterupted by the maddness that comes with the probate process.
His Widow Is In Charge Now What?
She has to do her estate planning to protect his legacy! Assuming he doesn't have a trust, she is now his only option to continue his legacy. If she passes away then all of Boseman's assets will then be held in her family's possession, like her mom and dad or any siblings (remember I said default rules aren't in place to give you the outcome you wanted). This would happen even if Boseman's parents are still alive. Once you inherit something it is YOURS.
This isn't a problem if this is what you intended. But how do you feel leaving everything to your spouse and then they get remarried? Now your assets can end up in the new spouses possession... I'll move on and let you think on that.
The Special Problem For Creatives
Creatives make items that can stand the test of time. Here is an example of what I mean, my daughter has fallen in love with listening to Micheal Jackson's song, Bad, and every time she turns on her Spotify, Jackson's estate/or Trust will get a check. 😎
Boseman had several movies we will continue to watch until the end of time and depending on his contracts and the structure of his compensation, his estate will continue to receive royalties (meaning probate can never close). His roles in both Avengers: Infinity War and Avengers: Endgame, were the highest-grossing films in the years they were released, with Endgame going on to become the highest-grossing film of all time. He even has a new movie and a tv show set to come out in the next year so the money will continue to come in.
He needed a full estate plan!
The Change We Need To See
START ESTATE PLANNING NOW!!
Only a third of people said they have a will in 2020, 24% less than in 2017, according to a Caring.com and YouGov survey of 2,400 people. Older and middle-aged adults were 20% and 25% less likely to have a will this year than last, they said. The top reasons they gave for not having a will? They hadn’t gotten around to it, they didn’t have enough money to leave anyone, it was too expensive to set up or they didn’t know how to go about the process.
As your Wealth Bestfriend please do not let me hear about another unexpected death of a young black celebrity or anyone for that matter who didn't leave an estate plan to continue to carry on their legacy.
Your plan doesn't have to be complex, check your state's laws and get to work. It's not hard, in some states you can do it yourself, others allow video wills. Google the rules for writing your own will, speak with an attorney. If you are a California resident check out Controlling Your Legacy a low-cost option to learn about estate plans and how to get yours started.
Your personalized estate plan can continue to speak for you when you aren't able to speak for yourself, but you have to have a legally valid document. Tell your friends, family, and EVERYONE you meet, that making a legacy (estate) plan is essential.
Your Wealth Bestfriend
💙🤍💙🤍 GO DODGERS!! 💙🤍💙🤍
Jala Eaton, Esq, CTFA is an estate planning attorney, fiduciary, and certified trust and fiduciary advisor with a mission to people build and protect their assets through investing and estate planning. The racial wealth gap is the problem and Generational wealth is the goal and the solution. When not advising her clients or talking about money on her blog and Instagram she likes to attend concerts and the private dance parties her daughter holds in their living room.