Lorenzen Wright played in the NBA for 13 years and earned $55
million. Shortly after his retirement, he was the victim of an unsolved
murder in a suspected drug deal. He was survived by his ex-wife,
Sherra Wright, and their 6 children. After his death, his ex-wife
received $1 million in insurance proceeds in trust for the children.
Within 10 months of receiving the proceeds, she was accused of having
spent nearly all of them on housing, furniture, cars, and travel. She is now subject to probate court action to remove her as trustee.
Several points:
1.
It is never a good idea to have a former spouse serve as trustee for
the children. A financially savvy third party is a much better choice.
Newly divorced individuals should quickly revise their wills and trusts
to remove the former spouse and to keep him/her away from assets for
the children.
2. In some defense of Sherra Wright, purchasing
real estate with trust assets is not spending them, it is re-allocating
the type of investment.
3. I suspect that Mr. Wright is not the
only former NBA player to have significant career earnings and to die
with less than 2% of them remaining. Annual child support and alimony
payments of $330,000 tend to rapidly diminish one's net worth.
