If Marilyn Monroe were alive today, she would have anticipated her 93rd birthday on June 1, 2019. Although she was typecast in the role of the “dumb blonde” in many of her blockbuster films, she was actually much smarter than many of the young and unprepared celebrities I’ve written about in the past. Despite the fact that she died unexpectedly at the age of 36, she was more prepared than most. She already had a last will and testament in place when she died, and she had obviously put a lot of thought into it.
In Marilyn’s will, she designated a small part of her estate to fund a trust designed to help care for her ailing mother, who had spent most of her adult life in a mental institution. The biggest part of her estate, though, went to her acting coach, Lee Strasberg, who at the time was married to a woman named Paula. Lee and Paula were like surrogate parents to Marilyn, and their daughter was a close friend to her. Marilyn wanted the bulk of her estate to benefit Lee and his family.
When Marilyn died, the first part of her plan worked out fine. Her sizable estate passed to Lee Strasberg, just as she had directed. But when Lee died, the millions he received through Marilyn’s estate didn’t pass to Paula or their daughter. Marilyn’s estate passed through Lee’s estate to a woman who was a complete stranger to Marilyn. Marilyn had had a plan—she had prepared a will before she died—so how could this happen?
In Marilyn’s will, she left the bulk of her estate to Lee outright, which meant he could do whatever he wanted with the inheritance after Marilyn’s death. A few years after Marilyn died, Paula died too, and Lee married a Venezuela-born actress named Anna. When Lee died, Anna got everything he owned, including his interest in Marilyn’s estate.
Anna apparently cared more for money than for Marilyn. She sold off all the personal things, all the sentimental items, and all the memorabilia. Then she hired a firm known for managing the estates of dead celebrities and made a ton of money from the rights to Marilyn’s brand and image. Eventually, she sold the firm created to manage those rights for somewhere between $20 million and $30 million. She got a windfall off of Marilyn simply because she had happened to be married to Lee when he died.
Marilyn planned ahead, so where did she go wrong? First, she used a will instead of a trust, which meant a significant portion of her estate went to court costs, lawyer fees, and other unnecessary expenses in the probate process. Second, she directed everything to Lee outright and did nothing to look out for the other people she wanted to benefit, like Lee’s daughter. If Marilyn had used a trust instead of a will, she could have kept her estate out of probate court, and she could have kept her estate out of the hands of a total stranger at Lee’s death.
This isn’t only a problem for celebrities and millionaires. Suppose I have a client who leaves her entire estate outright to her son, who is married to someone my client is very close to, someone who gave my client three amazing grandchildren. But shortly after my client’s death, her son divorces and marries someone else, whom my client never met. Although my client would have preferred to benefit her grandkids at the death of her son, her son could instead have left everything he owns (including the estate he inherited from my client) to his new wife. To make matters worse, when this new wife dies, she could leave her entire estate (including the estate her new husband inherited from my client) to her children from a prior marriage.
Situations like this are not uncommon, and they can unfold without any improper motives on the part of the family members involved. But they can be avoided if you use the right tools in the right way with proper guidance. Marilyn should have used a trust. She could have designated a portion of the trust for the benefit of her mother, and she could have allowed the rest to benefit Lee. But at Lee’s death, the trust would have contained another set of instructions for what happened next instead of leaving things at the mercy of events outside of her control.
You can do what Marilyn didn’t—set up a plan to ensure that the people you want to receive your estate do, even if life doesn’t unfold the way you anticipate. If you don’t have a plan, or if you do but you now realize it could be better, give us a call to set up a no-charge strategy session.