Mrs. N. 57 a widow for 2 years died unexpectedly of a heart
attack in California June 2005.
Unfortunately she died without a will, living will or other estate planing documents.
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| no will |
She had a married sister,
two children and two grand children at time of death .
1 -Her son - a long term non employed 37 year old son living
with his girl friend in North Carolina –
with a 16 yr old daughter in Montana who he doesn’t talk to, from a prior girlfriend whom he never married. The granddaughter and mother have had no contact with the family since the granddaughter was approximately 4 years old.
2- a 31
year old married professional daughter living in Texas with a 4 year old son the apple of grandma’s
eye.
Mrs N's Assets at time of death included
1- Her house worth 775k (paid off) when she died in June 2005
2- 50 k company stock in
her husbands 401k plan which she had never claimed
3 180k in liquid assets cash stocks bonds etc
4 Photos, jewelry, mementos etc. from her mother ( that were
left in her mother's (Rose's ) will , equally to Mrs N. and her sister but were at Mrs N's house
because Rose had lived with Mrs N. until she died 4 years ago and Mrs N. didn't want to part with them
5 A 100K 15 year old
term life insurance policy - she wrote on the policy face ( her copy) it was for her grandson’s college education, when she renewed
it for another 10 years 5 years ago.
Mrs N's know wishes, known by her son, daughter and sister.
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| burial at sea |
A- To have her ashes scattered at a special beach in her homeland and not be buried next to her
cheating husband.
B - To have all her mothers jewelry, photos and memento's given to her sister due to memories involved.
So what actually Happened ?????????
A - Mrs N's diseased husband's domineering New York mother descended and insisted that Mrs. N be buried in the dual plot she had previously bough for Mrs. N. and her son when he passed away. No one stood up to her and Mrs N. is now buried next to her husband.
B - While looking for a will in Mrs N.s house at time of death, the son and son in law divided up all the jewlery and family history photos ( most were thrown away) left by Rose in the house, leaving none to the sister who was the rightful owner.
C The grieving daughter agreed to let her brother come to California and live in the house, incurring reasonable expenses during probate, to be sole executor of the estate, waiving any fidelity bond and any waiving any required accounting of estate activities.
D - The named beneficiary in Mrs N's insurance policy had never been updated, it was the deceased husband. The son and the granddaughter were named as contingent beneficiaries. The insurance company paid the insurance policy 50/50 to the son and granddaughter. The grandson got nothing.
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| party in a spa |
E - The son decided that "since his life was on hold administering the estate" he was entitled to a
first class life style paid for from the estate while he "had" to be in California. All his personal expenses, gas, car food both purchased at the supermarket and dining out, athletic club expenses, as well as a portable hot tub purchase and parties at the house for his "friends" where paid for by the estate. This along with true estate expenses and legal and probate fees ate up significantly more than the 180K of liquid assets in the estate during the 21 months it took to sell the house and close probate.
F- Because Mrs N's death was near the height of the hosing market and the sale of the house dragged on because the son wasn't willing to accept a lower price and didn't wan to give up living there it finally sold for $ 595,000 ( a fire sale price) as both son and daughter needed the proceeds form the sale as money was spent that was not yet inherited and paid out .
G- The 401k stock was distributed to both son and daughter but only after the NY Grandmother signed away her contingent beneficiary rights with much hard feelings.
Was that it? not quite !
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| old fashion fighting over assets |
1 the daughter sued her brother over estate mismanagement but basically due to the agreements the only ones who made money were the lawyers on both sides.
2 The daughter let her husband invest the her part of the proceeds, not understanding any of the investment decisions he was making . He took a very aggressive approach, and they panicked and sold near the bottom of the 2008 stock market decline losing about 40% of their investment.
3- The son continued his high end life style as well as investing a large amount of money in a "can't go wrong" investment with one of his friends. All his money has been gone for some time.
And there is more
The New York Grandmother died and left all her assets to the grand children of her 2nd husband, that she had met in Florida during retirement, because she was so incensed at her only two biological grandchildren over what had happened.
Conclusion
Something to be said for paying attention to estate planning, and getting good advice during this trying time when your decisions may be clouded by grief.
I have a offer I make to my successful personal finance students. If you have an issue about finance in the future free free to contact me and ask. If for some reason i don't answer my sac email ( it could be that I am no longer teaching) I am the only Robert Koenig in the City of Orange so it should not be too hard to track me down. 
