THE COLLEGE ADMISSIONS SCANDAL & ESTATE PLANNING: THE PRIVILEGED CHILD PROBLEM
The recent FBI investigation and resulting wide-ranging criminal charges placed a spotlight on the disparity between wealthy families and those who come from not-so-privileged backgrounds. Apparently, it’s not enough for some affluent parents to merely donate to universities to make their high-school children more attractive to admission committees. Paying for tutors, elite private school, and encouraging their students to participate in activities that many families can’t afford wasn’t sufficient either.
Instead, the network of dozens of celebrities, business owners, and other rich and powerful parents paid tens of millions of dollars to a “college counseling service” that reportedly guaranteed admissions to elite colleges. The company allegedly used fraud, fake test scores, fictitious athlete profiles, and more, to con schools into admitting the students.
The scandal has marked widespread outrage across the country. Why should these ultra-wealthy children receive coveted admissions to elite colleges through bribery and cheating, at the expense of hard-working and bright students who would have otherwise been admitted on their own merits? The impact is especially hard to swallow for many minority students who already felt the deck was stacked against them.
While this backlash is understandable and warranted, this scandal raises many more questions – going far beyond college admissions. Why were so many defendants – and undoubtedly others whom prosecutors did not have enough evidence to charge – so willing to scam the system to benefit their children? And, in the long run, will it even help them?
It’s a symptom of a larger problem. Many wealthy parents believe that the best way to raise their children is to give them whatever they want – often including generous trust funds. But, more recently, many ultra-wealthy, like Mark Zuckerberg, Bill Gates, and Warren Buffett, have taken the opposite approach and refused to raise trust-fund children, instead earmarking their great wealth for charity. Philip Seymour Hoffman and Aaron Spelling were other examples of celebrity parents who refused to leave their children inheritances sufficient to turn them into spoiled trust-fund children.
But not all celebrities or other high net-worth parents follow this path. What some people like those involved in the college admissions scandal may not realize, sometimes it’s not only the over-privileged children who face hardships down the road from overindulgence. Too many times, when wealthy parents can’t say no to their children, they pay the price in the end.
These five legal battles dealt with this very question: Did over-indulgence of children cost the parents themselves when they reached their golden years?
1. Stan Lee
The Marvel co-founder was at the center of competing claims of exploitation, lawsuits, and even elder abuse during court proceedings occurring during the last year of his life.
[…to continue reading about the legal controversies surrounding Stan Lee, and 5 other celebrity cases where privileged children ending up costing parents later in life, along with our lessons to help avoid similar pitfalls in your family, click here.]
Danielle and Andy Mayoras are co-authors of Trial & Heirs: Famous Fortune Fights!, television hosts and keynote speakers. You can find them on Facebook, Twitter, Instagram, YouTube, and LinkedIn. Be sure to check out their new TV show, Fortune Fights, on the REELZ channel.
[photo credit: Flickr]