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Downton Abbey's estate planning lessons

Although most residents of West Palm Beach are likely not earls or countesses, the hit television series "Downton Abbey" contains some financial lessons that from which everyone can learn. One of these is that even people who don't own a castle can benefit from a solid estate plan.

The series revolves around the fictional Earl of Grantham and his family, who own an estate in early twentieth-century England. The earl has only daughters, who cannot inherit under British Law as it existed at that time, leaving only a distantly related male heir. Complications crop up when the Earl invests most of the family fortune in a Canadian railroad company that goes bankrupt.

This is this first important lesson that the show offers -- diversification of assets is extremely important in estate planning. Assets should be distributed between a variety of different types of investments, so that the failure of any one doesn't destroy the entire value of the portfolio. Secondly, it is essential to ensure that heirs and other family members are aware of the goals and intentions of the testator and that the individuals with control and decision-making power are clearly identified.

The series also highlights the importance of good legal documentation in the area of estate planning. This includes the use of trusts to protect assets from being squandered, wills prepared prior to the birth of new heirs to an estate specifying what happens to any business interests of the testator, medical directives that spell out the wishes of the maker in case of illness and who has authority to make decisions should the testator become incapacitated. These documents need to be prepared in such a way that they are clear and carry the force of law.

While drama is essential to any good television program, the main point of estate planning is to minimize it during the difficult period after a person's death. Thus, the most important lesson to be learned by Floridians from "Downton Abbey" is also the simplest -- have a plan, and make sure it is legally enforceable.

Source: The Wall Street Journal, "Money lessons from 'Downton Abbey'," Kelly Greene, March 1, 2013

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