What did Michael Jackson and millions of Americans have in common? Other than a love of music, the late pop singer and many of us have amassed debt that quickly got out of control. In Mr. Jackson’s case, he owed $500 million at the time of his death.
However, since his passing, his estate has paid off $475 million of that debt. What many do not realize is that just because the debtor passes away, it doesn’t mean that the debt dies with the debtor. Had Mr. Jackson settled his debts before his death, then he would have left a lot more to his heirs. For those looking to plan for their loved ones, and especially with those who are elderly and want to maximize what is left to their loved ones but who have debt, debt settlement should be considered as a function of their estate planning. By settling the debt during their lives, they can pay a fraction of what is owed, thereby maximizing what is left to their loved ones. Otherwise, if the debt is left for the heirs where there are assets in the estate to pay on that debt, the debt will need to be paid in full before any loved ones receive any type of inheritance. If you or a loved one is in this position, speak to a debt settlement attorney who can work in conjunction with your estate planning attorney to maximize the inheritance to your heirs.