Lessons We Can Learn from Famous Mothers and Their Estate Plans

Gloria Vanderbilt: No Trust Fund Kids for Her

A tenet of the American dream is that children grow up to earn more and have a better standard of living than their parents. Traditionally, upward mobility in America is achieved through hard work and the growth of the economy. Intergenerational wealth transfers are also widespread, with around 2 million households each year receiving an inheritance or a substantial gift, according to a Federal Reserve report.1 Those transfers are set to grow over the next couple of decades as baby boomers pass down $84 trillion to the next generation in what is being called “The Greatest Wealth Transfer in History.” 2

But not all parents are committed to leaving an inheritance to their children. Some, including Gloria Vanderbilt, believe that kids should make their own money and earn their own success in life. 

Vanderbilt Heiress Makes Good on “No Trust Fund” Promise

Gloria Vanderbilt, the great-great-granddaughter of railroad and shipping tycoon Cornelius Vanderbilt, inherited a trust fund worth an estimated $2.5–$5 million in 1925 (close to $35–$70 million today). She was worth an estimated $200 million at the time of her death in 2019. 

In a 2014 radio interview, Gloria’s son, CNN host Anderson Cooper, said she made it clear to her three children that they should not expect a trust fund from her. Cooper called inheriting money a “curse” and an “initiative sucker” and questioned whether he would have been so motivated if he felt like there was a “pot of gold waiting for me.” 3

It is a fair question to ask, given his family history. Cooper’s grandfather, Reginald Vanderbilt, was a reputed gambler who had squandered most of the family fortune by the time he died in 1925 and left the remainder to Gloria. 

Yet as Cooper pointed out, his mom, who had a successful career in the fashion industry, made more money than she inherited. Gloria started a denim business in the 1970s that was reportedly worth $100 million. In a 1985 interview with the New York Times she said, “I’m not knocking inherited money, but the money I’ve made has a reality to me that inherited money doesn’t have.”4

Although Cooper ended up receiving $1.5 million from Gloria’s estate, his net worth prior to his inheritance was thought to be more than $100 million, so he can hardly be labeled a trust fund kid. But while he did not inherit a fortune, he does appear to have inherited his mother’s work ethic. In addition to her denim line, she worked as a model, an actress, and an artist—all while balancing her duties as a mom. 

“We believe in working,” Cooper said when discussing his mother’s trust fund stance.5

Lessons Learned from the Vanderbilt Heiress

Gloria Vanderbilt did not go the route of super-rich parents like Warren Buffet, Bill Gates, Mark Zuckerberg, and Michael Bloomberg, who have vowed to donate their fortunes to charity. However, she did make good on her promise of not leaving a trust fund to her kids, which studies suggest can be a wise choice. 

Research from the Williams Group wealth consultancy found that 70 percent of wealthy families lose their wealth by the second generation, and 90 percent lose it by the third generation.6 A survey by U.S. Trust found that only 42 percent of high-net-worth individuals have a high degree of confidence that the next generation is financially responsible enough to handle an inheritance. 7

The Vanderbilt family presents an interesting case study—and counterpoint—to this familiar narrative of heirs squandering the family fortune. 

By the time the Vanderbilt fortune built by Cornelius, a man richer than Bill Gates in his day, reached Gloria four generations later, it was nearly gone. But despite receiving a trust with enough remaining funds to live comfortably on, her inheritance did not dull her drive for hard work and achievement. Gloria’s son Anderson Cooper also had a strong work ethic from a young age. He interned at the CIA while studying at Yale and went on to become one of the most recognizable faces in media. 

Experts say the main reason why fortunes are squandered is because those who create the initial wealth do not pass on detailed instructions or impose guidelines on how heirs should spend it. Attitudes towards wealth need to be shaped and inculcated. This can be done informally—say, by teaching kids sound money habits and providing a good example—and formally, such as through trusts that specify how and when the money can be used. 

Arguably, not leaving an inheritance can be a great motivator for loved ones to find their own path forward. Money cannot buy happiness, and having a trust fund or substantial inheritance does not guarantee that heirs will be successful. 

Parents know their children best. They also know that what is good for one kid may not necessarily be good for the others. While one child may manage their inheritance independently without issues, another may need safeguards and incentives. 

Wealth management and estate planning go hand in hand. When advising your clients how to achieve their financial objectives for the next generation, you may suggest that they could benefit from advice about how to structure a plan in ways that help preserve generational wealth. To collaborate with our estate planning attorneys on a wealth management strategy for your clients, please get in touch. 

Aretha Franklin: Too Much Estate Planning

Aretha Franklin was a larger-than-life figure to her many adoring fans during a music career that spanned nearly 60 years. Over that time, she put out 38 studio albums and 6 live albums. The Queen of Soul also penned two wills that became the subject of considerable controversy after her death and showed that no matter how famous you are, your final wishes could come down to state law if you are not proactive about estate planning. 

Two Wills Are Not Better Than One

Aretha Franklin, the commanding voice behind such hits as “Respect” and “Think,” was thought to have passed away in 2018 without voicing her views on how her estate should be divided among her four sons, seemingly leaving it up to state law and a judge to decide. 

But when Franklin’s niece agreed to serve as personal representative of the estate and began going through the singer’s Michigan home, she discovered not one but two handwritten wills—one from 2014 found in the couch cushions and a second from 2010 found in a locked cabinet. 8

The documents contained key differences about the division of real estate, personal property, and music royalties among her sons, and the sons disagreed over which version should control the estate. Further complicating matters, both wills had detailed lists of assets, but neither was prepared by a lawyer or listed witnesses. 

Her sons ended up squaring off in probate court over which of the discovered wills expressed their late mother’s true intentions at the time of her death. Following a two-day trial, a jury put the five-year—and at times combative—controversy to rest when it determined that the 2014 document should serve as the will. 

Lessons Learned: R-E-S-P-E-C-T the Estate Planning Process

Aretha Franklin avoided dying intestate (meaning without a will) by handwriting a will. But her estate planning errors led to a situation that was just as complicated—and just as easily avoided. 

Clients can learn these valuable lessons from Franklin about what to do—and not do—when creating an estate plan: 

  • Let loved ones know where documents are located. A will must be presented to the court and verified before it can take effect. If it cannot be located, it is essentially useless. Clients need to make sure loved ones know where their will, along with their additional estate plan documents like trusts, powers of attorney, and life insurance policies, can be found. Ideally, they should be kept somewhere secure, such as a bank safe deposit box, a fireproof safe, or a filing cabinet, or online in an encrypted cloud. Anyone needing access to the documents should also be given access codes. Document copies can be given to the estate planning attorney, local probate court, executor, or a trusted friend or family member as a fail-safe. 
  • Do not keep more than one version of documents. Only one will is admissible to probate. The most recent version of a will or other estate planning document typically prevails over an older one, as it did in Franklin’s case. If new documents are created, clients should consider destroying the old ones to alleviate confusion. 
  • Handwritten wills may be okay but are not ideal. Handwritten wills are considered valid in more than half of the states, including Michigan. However, they must meet certain criteria, such as bearing a signature and setting forth the material issues (what the person owns and the individuals they want to receive those accounts and property) in the person’s own handwriting. Some states, including Indiana, still require witnesses even on handwritten wills. Disputes over a handwritten will’s validity can be avoided by working with an attorney who can ensure that the document is legally prepared and executed. 
  • Make your intentions clear. Having more than one will raises questions about which should take precedence. But in some cases, even a proper will can be superseded by, for example, a beneficiary designation on a retirement account or property owned together by two or more people in joint tenancy. To prevent discrepancies, confusion, and conflicts, paperwork should be in alignment across estate planning documents. 

How We Can Help You Help Your Clients

It cannot be emphasized enough that estate planning is not just for the rich and famous. You may convey a similar message to your clients when discussing an asset management plan. In our celebrity-driven culture, figures like Aretha Franklin can serve as a cautionary tale about what can happen when a plan is left to the last minute or not completed under the guidance of an experienced estate planning attorney.

One of the best gifts a client can leave their family is a professionally prepared estate plan that leaves nothing to chance or speculation. Clients should know that a missing, incomplete, or unclear estate plan can lead to conflicts between heirs that necessitate court intervention and drain estate assets.

The more you understand estate planning and how it fits into a wealth management strategy, the more you can build client trust and earn repeat business. To begin a collaboration with our estate planning attorneys, please reach out to schedule a meeting. 

Lucille Ball: Dangers of Being the First to Die

I Love Lucy star Lucille Ball passed away 35 years ago. Decades after her death, important lessons can be learned from a court battle over some cherished heirlooms between Ball’s daughter and the widow of Ball’s second husband. 

Remarriage can pose emotional as well as legal challenges. When a client remarries, they need to carefully consider whom they are leaving their personal property to, especially if the personal property at issue is from a previous spouse. While monetary inheritances can be valuable, personal property is often invaluable to surviving family members and can spark fierce disagreements over who is the rightful heir. 

No Laughing Matter: The Legal Fight over Lucille Ball Memorabilia

Actress and comedy icon Lucille Ball had two children with actor Desi Arnaz: Lucie Arnaz and Desi Arnaz Jr. 

The couple divorced in 1960, and Ball married comedian Gary Morton in 1962. Following her passing in 1989, her estate was split between Lucie, Desi Jr., and Morton. 

After Lucy died, Morton married professional golfer Susie McAllister. They remained married until Morton’s death in 1999, at which point McAllister inherited items that had belonged to Morton and Ball, including love letters, photos, and a Rolls Royce. McAllister also ended up in possession of several of Ball’s personal items. Among them were her personal address book, portable backgammon boards, and lifetime achievement awards. 

Ten years after Morton’s death, McAllister put the items up for auction as she prepared to remodel her home. And that is when the trouble started between McAllister and Lucie. 9

Lucie asked that certain items be returned to her and threatened legal action to stop the sale if they were not. McAllister then sued Lucie and sought a judge’s ruling allowing the auction to proceed. In another twist to the case, the two women agreed that the possessions were left to Lucie in Ball’s will, but McAllister contended in her lawsuit that Lucie never claimed them from Ball’s estate, so they passed to McAllister. 

A judge ultimately ruled in favor of Lucie and said that the auction could be stopped—but only if Lucie posted a $250,000 bond. Lucie could not afford it, but her legal team reached an agreement with the auction house to have the lifetime achievement awards returned. The other items went up for sale. 10

Lessons Learned from the Lucille Ball Estate Kerfuffle

It is unclear why Lucie might have abandoned the personal possessions her mother allegedly left to her. There do not appear to be any media reports disputing this claim by McAllister. But if true, it raises the first takeaway from the legal battle: your clients need to claim any assets left to them as an estate beneficiary. Unclaimed inheritances pass to the next beneficiary in line—in this case, presumably Gary Morton, who then passed the forfeited items to McAllister following his death. 

Morton, however, is not blameless in this situation. He left items to McAllister that were originally intended for Lucie. While he may not have explicitly known the intentions of his late wife regarding her prized possessions, he probably should have known that they were better off in the hands of his stepdaughter. 

According to the auction house, McAllister kept the items for more than ten years out of respect for Ball and Morton. But she can hardly be blamed for wanting to eventually clean house and be rid of them. 

The second takeaway from this legal battle, then, is that if your client has remarried and has personal property from a previous spouse, they need to give due consideration to who should inherit it. Morton might have asked himself what McAllister would do with love letters between himself and Ball other than sell them, or why his new wife would want Ball’s personal address book or backgammon boards. The whole messy legal battle could have been avoided had he asked himself a few simple questions during the administration process. 

Advisors Help Clients Avoid Common Mistakes

Part of being a good advisor is knowing what questions to ask your clients. This perspective is honed through years of hands-on experience, trial and error, and learning from the mistakes of others. 

Advisors working in different specialties that overlap can also learn from one another, synergizing their knowledge to deliver the best possible client experience, to the mutual benefit of all parties. 

Schedule a meeting with our estate planning attorneys to find out how we can help you provide more value to your clients.

  1.  Laura Feiveson & John Sabelhaus, How Does Intergenerational Wealth Transmission Affect Wealth Concentration?, FEDS Notes (June 1, 2018), https://www.federalreserve.gov/econres/notes/feds-notes/how-does-intergenerational-wealth-transmission-affect-wealth-concentration-20180601.html.
  2.  Jennifer Wines, How Might the Great Wealth Transfer Change Society?, Kiplinger (Dec. 5, 2023), https://www.kiplinger.com/retirement/how-might-the-great-wealth-transfer-change-society.
  3.  Michelle Singeltary, Gloria Vanderbilt Reportedly Did Not Leave Her Heirs Much Money. Maybe You Should Follow Her Lead., Wash. Post (June 24, 2019), https://www.washingtonpost.com/business/2019/06/24/gloria-vanderbilt-is-reportedly-not-leaving-her-heirs-much-money-maybe-you-shouldnt-either.
  4.  Carol Lawson, Gloria Vanderbilt: Fortunes Good and Bad, N.Y. Times (Apr. 20, 1985), https://www.nytimes.com/1985/04/20/style/gloria-vandrbilt-fortunes-good-and-bad.html.
  5.  Singeltary, supra note 3.
  6.  See ​​Rhymer Rigby, Disinheriting Your Children Might Be for Their Own Good, Fin. Times (Oct. 14, 2019), https://www.ft.com/content/eb4a390a-d926-11e9-9c26-419d783e10e8.
  7.  U.S. Trust, U.S. Trust Insights on Wealth and Worth: The Generational Collide 14 (2017), https://www.truevaluemetrics.org/DBpdfs/ImpactInvesting/UST-BoA-Wealth-Worth-Overview-Broch-2017.pdf.
  8.  Ben Sisario & Ryan Patrick Hooper, Four Pages Found in a Couch Are Ruled Aretha Franklin’s True Will, N.Y. Times (July 11, 2023), https://www.nytimes.com/2023/07/11/arts/music/aretha-franklin-will-couch.html.
  9.  Lucille Ball Memorabilia from the Estate of Gary Morton—Including Love Letters, Rolls Royce, Awards and Artwork—at Auction in Beverly Hills, Heritage Auctions (July 6, 2010), https://news.cision.com/heritage-auctions/r/lucille-ball-memorabilia-from-the-estate-of-gary-morton—including-love-letters–rolls-royce–awards-and-artwork—at-auction-in-beverly-hills,g502294.
  10.  Jason Pham, Here’s Where Lucille Ball’s Kids Are Now & How Much They Inherited after Their Mom’s Death, Yahoo! Fin. (Mar. 7, 2022), https://finance.yahoo.com/news/where-lucille-ball-kids-now-133309434.html.