Creative Estate Planning – The Carolina Way?

For most attorneys (and in honesty, for this one as well) simple, conservative plans for handling assets through estate planning is usually paramount.  There are some who view estate planning as a form of “dead hand” control, but in reality, estate planning is all about caring for those that you have left behind.  Usually, the best way to do this is to have a plan that is as simple as possible that gives your executor or executrix the most flexibility to accomplish set goals.  Creating an estate plan that is too rigid can at times result in undesired scenarios.  This is not to say that one cannot or should not be creative with estate planning, just that such planning needs extra care.

Take for instance, Dean Smith, former coach of the UNC men’s basketball team.  Over the course of his 36 seasons he coached hundreds of student-athletes and built bonds with many of them as the recent outpouring after his passing last month has demonstrated.  Still, even though Dean Smith had so many to whom he was personally connected, he wanted to make one final gesture.  What ultimately occurred was that each player who lettered under him each received a message from him and $200.00. http://espn.go.com/mens-college-basketball/story/_/id/12563125/former-north-carolina-tar-heels-coach-dean-smith-leaves-200-letterman What seemed to go without a hitch did so because of some careful thinking.

First, Dean Smith made sure to qualify who would receive a gift, i.e. lettermen.  By doing this, it made it possible to understand the size of the class that would be eligible and not have to worry about the myriad of players who may have had short tenures with the team for various reasons.  Second, Dean Smith made sure to utilize a trust mechanism so that the funds from which each player was paid would be outside the estate and not be subject to reduction due to claims by creditors or higher priority conveyances.  Had Dean Smith simply stated in his will that he wished every letterman to receive $200 at his death may not have achieved the same result, and it certainly would not have been as quick in distribution.  Because a trust was utilized the technical aspects of how the trust was worded are not publicly available (which some see as a unique and attractive benefit in itself) but I imagine the wording allowed for the possibility of a variable amount to be distributed equally to the letterman dependent on the amount in the trust fund.  Doing otherwise might result in an inability to pay all the lettermen as instructed if the funds are inadequate.  If this was done in a will the result might be more disturbing as such a specific devise would be given priority over general devises such as “everything to my wife” etc.  In short, there are a lot of ways that a creative estate plan can go awry, but if you have an attorney working carefully to navigate such a plan, then you stand a much better chance of offering those grieving a sweet parting memory.  Creating great memories, that’s the Carolina way.

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