Key Takeaways:
- Trust and estate planning can help athletes and entertainers protect their wealth, rights, and legacy.
- Special consideration should be given to complex assets such as music catalogs, film rights, and intellectual property.
- Regularly reviewing and updating estate plans after major life and career changes is essential.
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You’ve worked hard to build your career — whether on the field, on stage, or on screen. While the wealth and opportunities that come with your professional success can be life-changing, they also bring unique challenges. Unlike traditional income streams, your career earnings may peak early, fluctuate dramatically, and be tied to assets like music catalogs, intellectual property (IP), or film and TV rights that require specialized planning.
That’s why creating and maintaining a trust and estate structure is essential. A well-thought-out plan not only preserves your legacy but also gives you control over how your wealth, brand, and creative assets are transferred to future generations.
Why Estate Planning Matters for You
Too many individuals — even high-profile ones — delay estate planning until a major life event forces their hand. For athletes and entertainers, that delay can be costly. Without the right structures in place, your heirs may face:
- Probate delays that tie up assets in court
- Costly disputes among family members or business partners
- Unintended transfers of wealth or IP rights due to state laws
- Exposure to estate taxes that can erode your legacy
Estate planning also provides peace of mind during your lifetime. For example, powers of attorney and healthcare directives ensure your wishes are honored if you become incapacitated. These documents may not be glamorous, but they’re just as vital as deciding what happens to your creative assets.
Starting With the Basics: Wills and Trusts
Wills allow you to name beneficiaries and designate guardians if you have minor children. However, wills must go through probate — which can be public, expensive, and time-consuming. That’s where living trusts add tremendous value.
By placing assets into a properly structured trust, you can:
- Transfer wealth privately and efficiently
- Decide how and when beneficiaries access funds
- Protect assets from creditors, lawsuits, or divorces
- Preserve your intentions across multiple generations
Consider the difference this makes for a pro athlete. If you unexpectedly pass without a trust, endorsement payments, residuals, or even your home may be tied up in probate for months or years. With a trust, those assets can be transferred smoothly, without delays that might jeopardize cash flow or create public disputes.
Special Considerations for Creative and Career Assets
Unlike traditional investments or property, creative and career-driven assets need tailored planning. Some examples include:
- Music catalogs and royalties: These can generate income long after your career peaks. A trust can control how royalties are distributed and prevent them from being sold prematurely. Prince’s estate, for example, became a public battle partly because these issues weren’t clearly defined.
- Film and TV rights: Leaving rights to future distributions requires clear documentation. Without it, heirs may struggle to claim payments or may unintentionally sell them under pressure.
- Name, image, and likeness (NIL) rights: Your personal brand can continue generating income long after you stop competing or performing. A trust can define ownership and future licensing.
- Intellectual property (IP): Patents, trademarks, and copyrights should be specifically addressed. Proper estate planning ensures continuity of licensing agreements or business ventures tied to your IP.
These assets often have unpredictable or long-term income streams. A trust structure allows your heirs to benefit from those revenues while protecting against hasty sales or disputes.
Types of Trusts and Other Structures That May Work for You
Depending on your goals, several trust structures and related planning tools can help you secure your wealth and assets:
Trusts
- Dynasty trusts: Protect assets across multiple generations and keep them outside heirs’ taxable estates. This can be especially powerful for music catalogs or IP rights that retain value for decades.
- Spendthrift trusts: Limit access for beneficiaries who may lack financial discipline or stability. This helps prevent heirs from squandering royalties or endorsement payments.
- Irrevocable trusts: Reduce estate tax exposure and protect assets from lawsuits or claims. These are often used to hold life insurance policies, real estate, or even ownership stakes in production companies.
Other Estate Planning Structures
- Family limited partnerships (FLPs): Provide a structure to manage business or creative holdings. For example, you could place your touring company, film production business, or catalog under an FLP to centralize control and simplify succession.
Choosing the right structure requires balancing flexibility, control, and tax implications — something best done with the guidance of advisors who understand the entertainment and sports industries.
Keeping Your Plan Up to Date
Creating an estate plan is just the beginning. For athletes and entertainers, your life and career can change quickly, so your plan must evolve with you. Update your documents after:
- Signing new contracts or endorsement deals
- Acquiring rights, catalogs, or creative works
- Marriage, divorce, or the birth of children
- Significant wealth increases or new business ventures
- Relocation to a new state or country
Even if no major changes occur, reviewing your plan every three to five years helps align it with evolving state and federal tax laws. Remember, what worked for you when you first signed your rookie contract or booked your first role may not fit your current circumstances.
Preparing Your Heirs
Even with a strong estate plan, your heirs may not be ready to manage the responsibility. Consider:
- Open conversations: Share your intentions and reasoning to reduce conflict.
- Education: Involve heirs in financial or philanthropic decisions to build experience.
- Professional trustees: For families with complex assets, consider appointing a neutral trustee to avoid sibling disputes or mismanagement.
Ultimately, estate planning is not just about passing on wealth — it’s about passing on values, stability, and opportunities for the next generation.
How We Can Help
At MGO, we work closely with athletes, entertainers, and other high-profile individuals to help preserve wealth, protect creative assets, and empower the next generation. Our advisors understand the unique nature of your career earnings, intellectual property, and long-term legacy goals. Contact us today to start building a plan that protects your success.