How to Earn Money After You Die

Did you know that Forbes has a list of top earning dead celebrates? Thirteen dead stars earned a combined amount over half a BILLION dollars, after they died, just in the past 12 months.

That made me wonder how an ordinary person like me could continue to accumulate assets after death!

Of course, the money would do me no good, it would accumulate to my estate for the use of my heirs. Talk about passive income, this is really it! How much more passive can you be than dead?

How to earn money after death.

Life insurance.

The most common and apparent method of receiving income after death is a life insurance policy. The death benefits from these policies are typically payable to your beneficiary – your spouse, children, mother and etc. However, the beneficiary can be your estate or a trust.

Policies are especially beneficial when you have large amounts in an IRA or other retirement fund on which heirs will need to pay income taxes (and possibly estate taxes as well). Providing immediately payable funds to the estate’s executor to handle these taxes is one possible function of a life insurance policy on your life owned by someone other than you or your estate. Second to die life insurance policies are supposed to be somewhat cheaper yet still provide that same benefit. In a second to die policy, husband and wife are both insured but no payouts are made until they both die.

Irrevocable trusts.

If you have set up your estate plan to move money on death to an irrevocable trust then that trust will no doubt be the recipient of any investment income from the assets that fund it.

Royalties.

If you are an author, musician, software developer or other creative person then any royalties due you during life will continue to accrue to your estate after death, assuming you set things up right in the first place.

Lost money.

Although not truly income, some heirs find that dead ancestors left funds in the form of escheated money with the state. When a financial institution believes it has lost contact with the owner of an account, they are required by law to turn that money over to the state after a certain set of procedures and length of time occur.

Typically this will not be a great deal of money and sometimes the pain of trying to recover it is a bit intimidating.

My parents forget to close a joint account they had with my name on it. After they died, the institution escheated the account. I found that ‘lost’ money and followed my states procedures to retrieve it. I had to provide death certificates for both of them, proof of their residence, proof of my residence, my social security number (actual copies of my physical card) and etc. Since I’m married, and the account was in my maiden name, I provided copies of my SS card from prior to marriage (with my maiden name), after my marriage (with my married name) as well as a copy of my marriage certificate and birth certificate. The agency wrote back to me asking me for a copy of my DEATH certificate! One quick call with me saying, Hello, I’m not dead, cleared that up and I got the money (less than $50).

Lottery winnings.

Although unlikely, some folks do win the lottery.  If you do, you can pass along your good fortune to your heirs by taking the distribution over your life and letting the rest go to your estate – in which you set up a trust to catch the distributions and get them handed out to your heirs.

How the stars and CEOs do it.

Employment contract payouts for the C level execs.

Alternet in article How Rich Executives Make Money From Beyond the Grave claims that sometimes CEO’s contracts provide huge benefits if the CEO dies in harness. These may include equity awards such as stock or stock options as well as incentives due but not paid out. Some even have after death non-compete clauses!

The article said:

“James Bernhard at Shaw was promised $17.4 million just for agreeing not to compete after death”

These are called ‘golden coffin’ benefits in the article.

Sales of their effects.

Elizabeth Taylor’s jewelry, costumes and artwork fetched over 210 million dollars this year.

Royalties from music or books.

Forbes noted that Michael Jackson’s after death take has been $145 million in the past 12 months and said:

“Music’s postmortem cash king has earned more than any single living artist since his death.”

 Merchandising and admission to theme parks.

Marilyn Monroe’s estate purchasers saw income of $55 million from licensing of her brand this year. Elvis’s theme park still brings in lots of money for his estate.

Well, the stars estate’s certainly have more interesting and lucrative ways of earning money postmortem than we normal people do!