After a year of disputes with the Houston family, Bedelia Hargrove has stepped down as the trustee for the late Bobbi Kristina Brown’s Estate. This latest twist in the Houston/Brown saga is based on the contentious relationship between Hargrove, Brown’s Grandmother Cissy, and Aunt Pat Houston. Disputes arose over the use of the Estates money to pay bills and to prosecute Kristina’s former adopted brother-turned-fiancé, Nick Gordon. In light of Hargrove’s resignation, a new temporary trustee, Ann Herrera, was appointed to handle the affairs of the Estate. This latest drama tied to the fortune of the late Whitney Houston is just another example of why strategic Estate Planning is essential.
Following the 2012 death of Whitney Houston, her Estate passed to the hands of her nearest relatives, including her daughter Bobbi Kristina Brown. Through her will, drafted in 1993 prior to the birth of her daughter, Houston bequeathed her Estate to Brown via a trust held until she reached a certain age
As stated in the will, Brown would receive trust fund payments in installments until she reached 30; the first of which was to be paid at the age of 21 to which she would receive 1/10th of the principal of the Estate. Two years following her mother’s death Brown inherited the first installment of the Estate. Tragically she herself would die merely a year later.
After her unexpected passing, this left the Estate to be administered by trustees and guardians with little to no direction of how exactly Houston wanted the money spent. The “rollercoaster ride” of the Estate of Whitney Houston sheds light on some of the mistakes that Celebrities make when it comes to preserving their financial legacies.
Unlike celebrities such as Prince, who failed to leave an Estate Plan at all, Whitney Houston attempted to act prudently with respect to her assets by drafting a will. Despite this attempt at protecting her Estate, she failed to take additional measures to adequately protect her heirs. Instead of drafting a will, Whitney could have used a living trust to shield her privacy, her fortune, and her beneficiaries. By setting up a living trust, her desires would have remained private. However, by only having a will, which is a public document, that had to be administered by a probate court, the World was privy to her last wishes. The trust could have outlined in detail various decisions regarding her fortune and how it was to be managed after her death as well as after the incapacity and death of her daughter. The trust also could have been privately updated to reflect the true mental state of Bobbi, the named heir; thus protecting her assets and her daughter, from the unsavory characters that she surrounded herself with. This failure to protect her privacy and adequately revise her plans allowed her daughter to fall victim to unscrupulous behavior, as well as public scrutiny.
Having an Estate Plan is essential. Whether it is through a will or trust, keeping an estate plan up-to-date is just as important as drafting one in the first place. These documents should be amended after significant life events, such as births or marriages. The estate plan should also be modified in light of the lifestyle and mental capability of the beneficiaries. Whitney Houston never updated her will, which was drafted before the birth of her daughter. The documents should have been amended, after taking into consideration the maturity level and rumored drug use of her daughter, Bobbi Kristina as well as that of the company that she kept. Instead of just handing over millions of dollars to a 21-year-old who may not have had the wherewithal to manage large sums, Houston could have drafted a detailed plan for the administration of her fortune. By limiting the amount of money she had access to, Houston could have also protected Bobbi Kristina from those trying to extract large sums of her fortune. So beyond creating your Estate Plan and keeping it updated, be critically honest and aware of the current status of your beneficiaries, to protect both them and your assets.
Having an Estate Plan is an essential step to protect your loved ones and assets. While most think writing a will is synonymous with creating an Estate Plan, there are other avenues to protect and distribute assets after death. While creating a will is better than leaving your estate up to the Probate Court, they do not offer the same protections and control as a trust. There are various types of trusts that will give people power over how their assets should be distributed upon their death. Trusts are also useful if there is a potential beneficiary that may misuse inherited sums. Contact an experienced Estate Planning Attorney to help avoid some of these mistakes and to plan ahead for the future.