Finances And Money

You're reading Don’t Forget To Make Your Will, posted on Sunday, December 30th, 2007 at 2:38 pm in Finance Advice, on BrainBloggers at the Finances And Money blog. More after the jump.

Many people stall when it comes to making a will. They say they are too busy or they don’t know exactly what to do. We say that you need to take care of it as early as possible. Make and set a time for you and your better half to sit down and set things up and make sure that you update it when possible. There are many people who fail to stay on top of it and because of that they accidentally leave people out of the loop. Here is a true example of that.

By all accounts, Anna Nicole Smith loved her baby daughter – Dannielynn – but she accidentally disinherited her. In a will executed in 2001, the celebrity model arranged to place all of her assets in a trust and identified her son, Daniel, as the beneficiary, rather than use the more inclusive term “my children” or “my issue.”

When Daniel died before his mother, the trust legally lapsed for want of a living beneficiary, since Smith had failed to name a contingent beneficiary for Daniel. Then, because she failed to update her will to include Dannielynn before her own demise in 2007 at age 39, her sole surviving child was accidentally disinherited. As a result, Smith’s estate, including the fortune she might’ve someday been awarded from the estate of her late husband, Texas oil billionaire J. Howard Marshall II, will likely pass through the laws of intestacy – that is, as if she had died without a will.

But don’t cry for Dannielynn, Argentina. Although children have no legal right to inheritance throughout most of the United States, many states do provide protection against accidental disinheritance. Because she was born after the execution of Smith’s will, Dannielynn will likely be considered a pretermitted child who was accidentally disinherited and thus will likely inherit the bulk of Smith’s estate.

But had Smith had other children or stepchildren, Dannielynn’s expected windfall would almost certainly have been challenged or shared. Russell Adams, an estate attorney in Granville, Ohio, says accidental disinheritance is a growing problem. “Without a doubt. I think it’s because we have so many kinds of death-disposition instruments available now,” he says. “The development of trusts has created a whole new area of accidental disinheritance. People are making the same mistakes in trusts that they used to make in wills. People often think trusts are great, that they fix everything, but they’re actually often a little more susceptible to error than wills.”