Actress Brittany Murphy died tragically at age 32 a few months ago.  Within a day of her passing, celebrity website TMZ reported that Murphy failed to update her will after her marriage to Simon Monjack, her husband of 2 1/2 years.  Instead, her will left everything to her mother.  The Probate Lawyer Blog’s article about it reminded people that updating wills and trusts after important life changes, like a marriage, is very important . . .  even for 32-year olds.

TMZ is now reporting that, according to Monjack, the story wasn’t entirely accurate.  While she did have a prior handwritten will naming her mother as her beneficiary, Murphy did update her estate plan after her marriage, complete with a will and trust.  Monjack said he asked Murphy to include a provision stating ”I am married to Simon Monjack who I have intentionally left out of this will.”

That provision was important because, without it, Monjack may still have inherited some of her assets as a “pretermitted spouse”.  By specifically mentioning and disinheriting her husband, Murphy made sure that her estate went to only to her mother.  This language was critical to make sure her wishes were followed (rather than those of the State of California).

With so many examples of celebrity estate planning gone wrong, which we cover extensively in our book, “Trial & Heirs:  Famous Fortune Fights!”, it’s refreshing to see a story of someone who did it right.  ”Trial & Heirs” discusses celebrity errors to show you what not to do when planning for your heirs.  But, you can also learn from celebrities like Brittany Murphy who do the proper estate planning.

So what did Murphy do right?

• She worked with an attorney to create a formal will and trust, rather than relying on a handwritten will;
• She used a trust, rather than just a will, to avoid probate court (that is, if she properly “funded” the trust during her life);
• She communicated with her loved ones about her intent and where to find her documents, so there wasn’t confusion and dissension after she passed;
• She updated her documents after getting married; and
• She used specific language to make sure her money passed to her mother and not her husband.

By Andrew W. Mayoras and Danielle B. Mayoras, co-authors of “Trial & Heirs: Famous Fortune Fights!” and husband-and-wife legacy expert attorneys.  As educators across the United States through speaking engagements, print, broadcast, and social media, Danielle and Andrew consistently draw rave reviews and are in high demand.   Email them at contact@trialandheirs.com.

Kiplinger’s Personal Finance Magazine has an interesting article that’s coming out in the March 2010 issue, about do-it-yourself estate planning.  It was written by Jane Bennett Clark, Senior Associate Editor:

You’ve been dragging your feet for ages on writing a will and drawing up other estate-planning documents. Now, to avoid the hassle and expense of hiring a lawyer, you’re considering using online forms to get the job done. Companies such as Nolo, LegalZoom and Rocket Lawyer allow you to do just that. Not only do they provide do-it-yourself estate-planning documents, but they also offer guidance on filling them out and general information on estate-planning issues.

The cost for such off-the-rack estate planning? As little as $50 for a simple will to $220 or so for a package that includes a will and a living trust. That’s cheap compared with the $300 a lawyer might charge for a simple will or the $1,000 or more that a comprehensive estate plan might run you. Still, you get what you pay for, says Danielle Mayoras, an estate-planning attorney and coauthor, with Andrew Mayoras, of Trial & Heirs(Wise Circle; $20 at Amazon.com). Although the products themselves may be sound, one size doesn’t fit all, says Mayoras. “They don’t address as many what-ifs as if you had an attorney with you.”

Last will and testament.Using an online will makes sense if your finances and circumstances are uncomplicated, says Joanna Grossman, a professor at Hofstra University School of Law, but “people don’t know whether they do, in fact, have a simple situation.” If you go the do-it-yourself route, be sure to have the will properly witnessed, says Betsy Simmons, an estate-planning attorney at Nolo. “You’re not done until you do all the things that make it official.”

If your situation is, in fact, more complex — you want to disinherit a family member, say, or provide for a child with special needs, or shield a large estate from estate taxes — consult a lawyer. (The federal estate tax was repealed for 2010, but Congress is expected to reinstate it retroactively.)

Revocable living trust. Often used for large or complex estates, this vehicle lets you transfer ownership of your assets to a trust that you control and avoid the public process of probate when you die. If you decide you need a living trust, hire a lawyer. Trusts are, by nature, tailored to particular situations, and they have a lot of complicated rules, warns Grossman.

A lawyer will also have you fund the trust properly, which involves transferring the title on everything — from the deed on your house to bank and brokerage accounts — from your name to the trust. Failure to do so (a common rookie mistake) renders the trust inoperable, says David Shulman, an estate-planning attorney in Fort Lauderdale, Fla.

Durable power of attorney. This document lets you appoint a representative to manage your financial affairs should you become incapacitated. Depending on your intentions — and state law — it goes into effect either as soon as the document is executed or if you become mentally incompetent. In contrast, a regular power of attorney ceases to exist if you become incapacitated. It pays to work with a lawyer to make sure you use the right documents and choose the right person for this important job.

Advance directives. You need two state-specific documents: a living will, in which you specify the treatment you want to receive if you cannot speak for yourself, and a durable health-care power of attorney, in which you appoint someone to make health-care decisions on your behalf when you cannot. They are available free through hospitals and state medical societies. You don’t need a lawyer to fill them out, but you should discuss the provisions with a doctor and your health-care proxy before signing the documents.

[click here to see the article on Kiplinger.com]

The article has some good advice.  We always advocate working with an experienced estate planning attorney.  People who try to use a preprinted form, or trust or will kit, usually end up costing their families much more than they save in legal fees.  Don’t take shortcuts with your legacy!

By Andrew W. Mayoras and Danielle B. Mayoras, co-authors of “Trial & Heirs:TM Famous Fortune Fights!” and husband-and-wife legacy expert attorneys.  As educators across the United States through speaking engagements, print, broadcast, and social media, Danielle and Andrew consistently draw rave reviews and are in high demand.   Email them at contact@trialandheirs.com.