By Norman Boone
Learn more about Norman on NerdWallet’s Ask an Advisor
When Prince died last week at age 57, he left behind one full sibling and a massive estate. Its total value is unknown, and there’s been much speculation about who will inherit it — especially because the musician appears to have died without a will.
Prince wasn’t necessarily motivated by money, as he told Rolling Stone magazine in 1985: “I was never rich, so I have very little regard for money now. I only respect it inasmuch as it can feed somebody. I give a lot of things a way, a lot of presents and money. Money is best spent on someone who needs it.”
Due to his great professional success, however, he amassed a lot of wealth.
Unless any documents indicating Prince’s exact wishes turn up, the court will determine who inherits his estate. Typically, estates go to family members. In the absence of a will, any friends, organizations or causes that Prince cared about will most likely be left only with memories. The same could happen after you’re gone if you don’t prioritize estate planning.
The pieces of an estate plan
A primary estate plan consists of a will and often a trust, which appoints a third-party trustee who ensures your wishes are followed appropriately. A complete estate plan also typically includes health care and financial powers of attorney. Power of attorney means someone you designated — it can be your trustee — can pay your bills and make financial and medical decisions on your behalf if you can’t make them for yourself, usually due to an accident or injury.
Why estate planning is important
Without a will and other estate planning documents, state law and the courts decide what happens to your property. That could mean even siblings you never got along with would receive their share of your estate, while a very close friend would be left out in the cold. Prince supported numerous causes during his life, but none has a claim to his estate under the law.
If you’re a parent, you can also use a will and trust to determine who will take care of your children after your death. And you can name someone — it can be same person — to handle your finances and pay the bills, making sure your kids grow up in the way you wanted.
Don’t forget to complete the process
People generally don’t like to think about their own demise. For that reason, many talk to lawyers about wills but don’t actually sign the documents or transfer ownership of their homes or other important property to the trust.
Seeing the lawyer isn’t enough. If you want your will and trust to mean anything, you have to complete all the steps. It will take some time and may require some difficult decisions, but it’s worth it. Completing a will streamlines the inheritance process, making it easier on the people you care about.
Without a will or trust, people will have to guess what you wanted. Arguments and a lifetime of hurt feelings among family members often result. Moreover, without your instructions, the courts will have to supervise everything. The legal wrangling over Prince’s estate will likely serve as an example.