Seventy-five-year-old Rolling Stones rocker Mick Jagger and his 30-year-old girlfriend Melanie Hamrick recently welcomed a baby boy – Deveraux Octavian Basil Jagger – the eighth addition to Jagger’s ever-expanding brood of children.
Jagger has been married (and divorced) once and has also had several other relationships. In total, including Deveraux, he has now had eight children with five women. He also has five grandchildren, and became a great-grandfather on 19 May 2014, when his granddaughter Assisi gave birth to daughter Ezra Key. Jagger’s net worth has been estimated at $360 million.
With the arrival of his 8th child, and with his other descendants to cater for, Jagger’s finances must be getting into a bit of a mess. Not only that, but with his recent heart value surgery he’s probably starting to feel a little bit more mortal.
But how can he ensure his beloved are provided for and his wealth is distributed among his children?
He’s lucky he doesn’t live here in the Czech Republic as our forced inheritance rules would make the administration of his large and complex estate into a big mess. As we explained in our 2014 article about another music icon, Karel Gott, complicated families can be difficult to deal with.
We have no idea what Mick’s plans are for his inheritance, but like many people (not just rock stars), he will probably decide to give the greater portion of his wealth to family members who are in a less financially secure position, such as minor descendants.
If that’s the case, there are a number of ways that he could do this. He could use his will to divide his estate into percentage shares and allocate a greater share to the younger children. Another – probably better idea – would be to set up a discretionary trust.
A discretionary trust is a very flexible form of trust. The trustees have discretion as to who, within a potential class of beneficiaries will get money, how much, and when. The person setting up the trust provides guidance to the trustees as to how they should use their discretion by way of a non-binding ‘letter of wishes’. Such trusts are useful when a person has identified a group of people they wish to benefit, for example, children, grandchildren, etc, but are not certain which of them will need financial help in the future or what help will be required. It also works across generations: not just for his current wife and children, but also for grandchildren, great-grandchildren and even yet unborn great great grandchildren.
The other benefit of a discretionary trust is that it makes sure that money doesn’t go to places that it shouldn’t. It might be that there are some of his children than Mick doesn’t want to benefit. Perhaps because they already have enough money, perhaps because they are financially irresponsible, or perhaps because the family relationship is not that great. There might be others who Mick thinks need the money more. The money can also be paid out in various ways; as cash; as the right to use an asset such as a house; to support education or even to support the children’s business or music career. It can also be used alongside the family goals to support the charitable and other causes that Mick cares about.
A discretionary trust provides a great tool to ensure that the money ends up in the right place while at the same time avoiding unpleasant lawsuits and family conflict.
You don’t need to be a millionaire rock star to set up a discretionary trust. They work just as well for normal families.
For more information on discretionary trusts and other tools to help you take control of your inheritance, contact us.
