'Empire' Hits Major Estate Planning Issues
Season 2 of the well-received Fox show began Sept. 23. WealthManagement.com recently published a great article highlighting the series, explaining why the epic squabbling family drama has grown a legion of dedicated fans. The show has been called "King Lear"-meets-hip-hop by some television critics.
If we set aside the show's entertainment industry backdrop and wild storylines of murder, manipulation, and mental illness, you're left with a core story of real-world estate planning issues faced by a business owner.
Family patriarch Lucious Lyon (portrayed by Terrance Howard) is a former drug-dealer turned hip hop mogul and CEO of Empire Entertainment. Diagnosed with terminal ALS, he seeks to find a worthy successor among his three sons to assume management of his highly successful company.
The entrepreneur's imminent disability and death sets up the most common issue estate planners face with business-owning clients. Who should inherit the reins?
While nobody would discredit Lucious' sharp business skills in growing an empire, it's also pretty obvious his demons have turned him into a monster of a father. Knowing his time is running out, Lyon pits his sons against each other to ferret out the strongest heir apparent.
Throwing gas on the fire is Lucious' first wife, Cookie, who is bent on gaining power in a business that she sacrificed motherhood for by spending 17 years in prison for a crime she didn't commit. As the sacrificial lamb, Cookie gave her husband $400,000 in cash to fund the business and in turn missed out on the most crucial growing years of their children. Now, she wants equal control.
Add in a beautiful young fiancé for Lucious, Anika, who is trying to establish a foothold in the family and the company, and you can see the fireworks. The women hate one another, and embark on their own power-seeking plots.
Yes, "Empire" is basically a soap opera, but that doesn't mean we can't learn from it as advisors. TVCheatSheet.com came out earlier this year with a great tip list on the major estate planning lessons of "Empire," and we think at least a few are worth repeating:
1. Protect assets when going into business with a significant other - Lucious created a complicated triangle by going into business with his ex-wife and his fiancé. It's crucial for business owners to protect their financial assets when marrying. Drafting a prenuptial agreement helps shield those assets. Keep in mind, clients can still draft a postnuptial agreement if they're already married.
2. Establish an estate plan - Lucious has perhaps months before he dies. Before a client becomes seriously ill, he or she needs to get all financial affairs in order. Don't wait until things look grave. It's important to have documents drafted by an experienced estate planning attorney that name the client's choice for the healthcare power of attorney and durable financial power of attorney. A client also should hire an attorney to draft a will and trust outlining his or her wishes for business and personal assets, including who should receive any personal belongings.
3. Establish a succession plan - The main reason Lucious' empire is falling apart is the chaos created by the lack of a clear successor. If he doesn't establish a succession plan to establish someone to take over after he dies, he's leaving everything up to a battle between his sons, his fiancé, and his ex-wife. Business owners need to decide who will manage and own the company should they become incapacitated or die. Again, your clients should seek the advice of an estate planning attorney who has experience with business succession strategies.
We hope this information was useful to you and helps you and your families. If you have a specific case or a question, don't hesitate to call our office at 919-443-3035.