Whitney Houston: The Greatest Trust of All?Posted by in Blog on March 28, 2012
Ever since pop star Whitney Houston died last month, there has been speculation about her will, and whether she would have one. After all, many celebrities, such as Sonny Bono, Steve McNair, John Denver, and Jimi Hendrix, died without wills. But as it turns out, not only did Houston have a will, but she had a trust set up for her daughter Bobbi Kristina.
Michael K. Kirsch of Kirsch Financial Services writes for TrustsandEstates.com that according to the will, which was written in 1993, shortly after her daughter was born, Houston wrote a will in which her “assets will be placed in a trust with one-tenth of the principal paid to her at age 21, one-sixth at age 25 and the remaining balance at age 30.” Kirsch says that a “codicil” from 2000 makes Cissy Houston, Whitney’s mother, the executor. Incidentally, Bobby Brown, Houston’s husband at the time, was never included in the will.
Hirsch writes that because Houston designated a trust, rather than a simple will, for her assets, the “bequests that are kept in trust for the benefit of the heirs enjoy protection from creditors, predators (including ex-spouses), irresponsible spending and future estate taxes.” So that means that Bobby Brown cannot get his hands on the money. In addition, Houston’s daughter will not get the bulk of the money until she is 30.
It’s unclear how much Houston’s estate will ultimately be worth –there have been estimates that it was worth between $10 million and $20 million, while other estimates say that she was broke. However, the estate could have more money, due to the increased sales of her music since her death.
Hirsch says that “Whitney’s death should serve as a reminder to financial advisors to make sure their client’s estate plan includes more than a simple will and that they update documents every few years.” He says that for most clients who have some assets, a simple will is not enough. Hirsch says that establishing a trust is the “best way” for people to pass on their assets to their loved ones.
Written by Lisa Swan