Estate Planning Lessons from Yellowstone and Rupert Murdoch’s Trust Missteps

Estate planning for high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals isn’t just about wealth.  It’s about legacy, control, and, if done poorly, potential family chaos. Two recent very public family battles, one real and one from the Taylor Sheridan television universe, have highlighted the importance of strategic estate planning.  We are talking, of course, about the Dutton family in Yellowstone and the real-world saga of Rupert Murdoch’s family trust.

Both illustrate what happens when estate planning lacks foresight, structure, or transparency. While Yellowstone dramatizes estate planning failures for entertainment, the Murdoch case shows how even billionaires can face succession battles when things aren’t crystal clear.

Let’s break down the key estate planning takeaways from these two cautionary tales.

One: Never Assume the Next Generation Will "Figure It Out" (Because They Won’t)

Yellowstone: The Dutton Family’s Trust and Control Issues

The Dutton family’s sprawling Montana ranch is central to Yellowstone, but patriarch John Dutton never fully cements his succession plan. While he clearly wants to keep the land in the family, his strategy to do so is murky at best. The result? Constant infighting, power plays, and legal battles over who should control the empire.

Key Mistakes:

• Lack of a clear trust structure that defines roles and responsibilities.

• Leaving succession unclear, which invites legal challenges and power struggles.

• Not separating family loyalty from business practicality.

  
  

The Murdoch Family Trust Battle

Rupert Murdoch built a global media empire but structured his trust in a way that left room for family disputes. His trust gives equal voting power to his four eldest children, which may sound fair but is a recipe for internal conflict. Now, as he steps back, his children are already jockeying for control of the empire.

Key Mistakes:

• Not establishing a clear decision-making structure in the trust.

• Allowing multiple heirs equal say, which often leads to gridlock.

• Failing to implement a decisive succession plan long before stepping down.

  
  

How Life Insurance Could Have Helped

A properly structured life insurance policy could have provided liquidity to equalize the estate among Murdoch’s heirs without forcing them to battle over voting shares. In the Duttons’ case, life insurance could have been used to create liquidity for estate taxes and operational expenses, preventing the need to sell land or business assets just to cover obligations.

Lesson: Decide who is in control and make it airtight. Estate plans should explicitly outline roles, voting rights, and decision-making protocols to avoid chaos.

Two: Estate Planning Isn’t Just About Taxes…It’s About Power

Estate planning for affluent families isn’t simply about minimizing taxes (though that’s critical). It’s about preserving wealth across generations while maintaining operational control.

Yellowstone: No Separation Between the Ranch and the Family

John Dutton makes a classic mistake: his identity is too tied to his business. The ranch and the family are one and the same, meaning his estate plan, or lack thereof, puts everything at risk.

A smarter move? Setting up a trust with clear governance rules, possibly even a family office structure to manage the assets, keeping personal conflicts from jeopardizing business operations.

Rupert Murdoch: Keeping the Power Without the Title

Murdoch structured his trust in a way that keeps him influential even after stepping down. However, his trust still leaves key decisions up for debate among his children. A more refined approach would have been implementing a control mechanism, such as weighted voting rights or independent trustees, to ensure a smoother transition.

Lesson: Estate planning isn’t just about passing down money. It’s about controlling how decisions are made. A well-designed trust should account for family dynamics, operational governance, and mechanisms to prevent deadlocks. Life insurance can provide additional financial independence, allowing heirs to step away from the business if necessary.

Three: Trust Issues - Too Little and Too Much

Murdoch’s Use of an Irrevocable Trust

One of the most crucial aspects of Murdoch’s estate planning is his use of an irrevocable trust - a move that, while great for tax planning and asset protection, comes with a catch: once it’s set up, it cannot be changed.

This means Murdoch locked in his estate plan decades ago, and now, regardless of how family dynamics have shifted, the trust operates according to its original design. While this has benefits, such as shielding assets from estate taxes and creditors, it also means there’s little flexibility to adjust for unforeseen family conflicts, changing business interests, or even personal relationships.

Yellowstone’s Lack of Structure

On the other hand, John Dutton seems to have no such formalized trust in place (or if he does, it certainly isn’t working well). His estate appears to be held in an undefined structure, leading to disputes, unclear leadership, and constant threats from external forces looking to seize control.

How Life Insurance and Trusts Work Together

A properly structured irrevocable life insurance trust (ILIT) could have provided Murdoch’s heirs with additional liquidity and a non-contested pool of assets, preventing some of the anticipated battles. For the Duttons, an ILIT could have funded estate tax obligations or bought out heirs who didn’t want to remain involved with the ranch.

Lesson: Irrevocable means irrevocable. Before locking in a trust, consider whether a more flexible structure, such as incorporating an ILIT or other liquidity solutions, would be beneficial.

Four: Equal Is Not Always Fair…And Fair Is Not Always Equal

For affluent families, treating heirs equally isn’t always the best approach. Different family members have different skills, interests, and capabilities.

Yellowstone: Trying to Treat Heirs the Same When They Clearly Aren’t

John Dutton struggles with succession because his children are vastly different in competence and interest. Kayce is reluctant, Beth is a powerhouse, and Jamie is, well, Jamie. Yet, the estate plan doesn’t seem to acknowledge these differences. Instead of structuring an inheritance plan that reflects their actual roles and abilities, the lack of clarity breeds resentment and infighting.

A more sophisticated approach? Structuring a trust with tiered ownership rights or life insurance-funded buyouts for those who don’t want to participate in the ranch. That way, Kayce (if willing) could take control, while Beth and Jamie could receive their share without disrupting the family’s core asset.

Murdoch: An Equal Power Split That Leads to Factions

Rupert Murdoch’s trust gives equal power to all his children, but not all of them are equally equipped (at least in Rupert’s eyes) to run the empire. By granting each of his four eldest children equal voting rights, he has unintentionally set the stage for gridlock and internal battles. While equal may sound fair, it often isn’t practical, especially when billions of dollars and a global media conglomerate are at stake.

A better solution? Using life insurance to create non-business wealth for heirs who are not directly involved in the family enterprise. For instance, instead of splitting voting power evenly, Murdoch could have structured a buy-sell agreement funded by life insurance, allowing one or two heirs to assume leadership while the others receive financial compensation without interfering in business operations.

How Life Insurance Can Create a Fair (Not Just Equal) Estate Plan

Life insurance can be a powerful tool for estate equalization - ensuring that heirs who don’t inherit direct control of a business or major asset still receive their fair share of the family’s wealth.

• Buyout Funding: If some heirs want to exit the family business, life insurance can create options rather than obligations.

• Estate Tax Coverage: If a family estate includes illiquid assets (like the Yellowstone ranch), life insurance can cover estate taxes without requiring a sale.

• Fair Inheritance Planning: Rather than splitting everything evenly, life insurance can be used to compensate heirs who do not take an active role in the family enterprise, ensuring financial balance without creating conflict.

Lesson: Customization is key. Estate plans should reflect each heir’s strengths and interests rather than simply splitting everything down the middle. Life insurance provides the flexibility to customize inheritances without jeopardizing family harmony or forcing business sales.

Final Thoughts: The Smart Way to Avoid These Mistakes

For HNW and UHNW individuals, estate planning should be proactive, structured, and strategic. Some key takeaways:

• Use trusts to prevent conflicts.  Dynasty trusts, voting structures, and defined roles prevent disputes.

• Be cautious with irrevocable trusts.  They offer strong tax benefits but can’t be changed once set.

• Life insurance provides flexibility.  It can equalize inheritances, pay estate taxes, and prevent forced sales of key assets.

• Estate planning is about control, not just wealth.  A well-structured plan ensures the right people are in charge.

• Privacy matters.  Public disputes damage reputations and cost millions in legal fees.

  
  

Both Yellowstone and the Murdoch saga show that estate planning isn’t just about passing down wealth. It’s about ensuring that wealth stays protected, operationally functional, and free from unnecessary conflict. Done correctly, it’s the key to preserving a legacy for generations to come.