Estate planning Wills

May 9, 2022

John Brennan, Senior Vice President of Trust and Financial Services, at Cape Ann Savings Bank in Gloucester, Massachusetts talks with John Maher about estate planning wills. He explains how a will affects your estate after your death.

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Transcription Disclosure: Below is a transcript of the conversation between John Maher and John T. Brennan. Please note, this is an unedited "word for word" rendition of the actual conversation and is not intended to be grammatically correct.

John Maher:  Hi, I'm John Maher. I'm here today with John Brennan, Senior Vice President of Trust and Financial Services, at Cape Ann Savings Bank in Gloucester, Massachusetts. Today, our topic is estate planning wills. Welcome John.

John Brennan: Hi John.

What Is a Will?

John Maher: So John we're talking here in this series about estate planning and some documents that go along with estate planning. The first one is a will. What is a will?

John Brennan: So a will is a written statement of someone's wishes as to what will happen to the property that they own once they die. So it's really not more complicated than that. As we go on in our conversation, there's certain rules about creating the will, but it's really not more complicated than that in its essence.

The Role of Wills in Estate Plans

John Maher: Okay. And why are wills an important part of an estate plan?

John Brennan: Because wills are really the fundamental linchpin of every estate plan. Have you ever seen the New Yorker and seen New Yorker cartoons?

John Maher: Sure.

John Brennan: A staple of cartoons is the notion of reading the will.

John Maher: Right.

John Brennan: Because it's really regarded as the ultimate expression of what the person wanted.

Reality Vs Wills on TV

John Maher: Right. And you see that all the time in movies, like mystery movies and things like that, where the whole family gets together at the estate house and then they read the will from grandma who passed away or something like that.

John Brennan: And wills aren't normally read with this big dramatic reading. And it probably happened at various times. Regardless, the will is the most important part of the estate plan because it's been part of our legal system for hundreds of years. Everybody is pretty much aware of what a will is. It's a fundamental, shall we say.

Who Needs a Will?

John Maher: Are wills important for everybody? Or are they really just important if you have a large estate or a lot of money or you're wealthy?

John Brennan: Wills are important for everybody. So you could be a billionaire and have a will and you could be a pauper and have a will. And obviously it's the amount of property that the will is going to act on where it's determinative of its power, but if you're going to have anything in an estate plan, you're going to have a will. It's step one. Step one, do not pass go, do not collect $200 without a will.

Types of Wills

John Maher: Are there different types of wills?

John Brennan: Well, there are different types of wills. One of the things about a will is it is paper. I mean, it's not fancier than that, but its formalities which elevate it to a legal document. Those formalities are really driven by state law and say in Massachusetts, you have to have two witnesses, for example. You have to be over 18 and the rules are very basic.

But there's other types of wills. There's what's called a holographic will, which is not something that's recognized in Massachusetts or would be tougher to recognize in Massachusetts, meaning it's a handwritten will. So in different states we'll have different ideas of what represents a will.

I honestly love celebrity stories as illustrations about what's going to constitute a will. Aretha Franklin was a case where there was a lot of discussion because she left some handwritten wills and she had a will that she hadn't signed that she worked on with her law firm. And the question was, which one of these is the truest expression of her wishes, which one is closest to her will.

A living will is something that usually is in the healthcare context and that relates to end of life care. But it's more along the lines of DNR orders, do not resuscitate orders. It's that type of thing. What parameters, if you had to be fed by a tube, would you want to continue living? If you were in a vegetative state, would you want to continue to take nourishment and medicines? Sort of those types of questions are addressed by a living will.

Living Will Vs. Traditional Will

John Maher: Okay. So the living will is somewhat of a distinction between just a regular will, where the regular will is more about your property and what's going to happen to your property and your money and things like that after you pass away. But the living will is more about end of life care.

John Brennan: Exactly. Yes. One of the things, and I think we probably talked about this, and we talked about in one of our early modules, but a will acts on everything that is titled in your name. So myself, John Brennan, I own a car; it's in my name. I own a bank account that's in my name. I own a house that's in my name. Literally, the process of a will is my written wishes.

The will gets taken to the probate court. Probate means to prove. And then the will is proven, meaning it's not a fake. Then it's allowed. My executor gets appointed. The will takes that property that's titled in my name and retitles it according to my wishes. And all that person does, that personal representative, that executor, that's their role, is to gather the assets that are in my name and distribute them according to the terms that I've written my will.

How Do You Set up a Will?

John Maher: Okay. So talk a little bit more about how you set up a will.

John Brennan: I would say at this point, you definitely want an attorney to help you with this. Because like I said, there are will formalities. It has to be in writing, so it can't be oral. No oral wills. It has to be signed by the testator, and it has to be witnessed by at least two witnesses, and I'm pretty sure you have to be over 18 as well.

And so when you get into that stuff to keep yourself safe, I mean, technically, you could create your own will, but to make sure your will is allowed and especially if your will does anything controversial. If you have a will and you did it yourself and you just give everything to your wife who's your only heir, maybe you could get away with it.

But for the layperson, there's traps for the unwary and I really would recommend you'd have an attorney do it just because... Going back to the idea of probate and the probate court and proving the will, if you did it yourself, you're so much more open to a charge of the will being disallowed by the court because it just misses something which an attorney wouldn't.

How Can an Attorney Help You Create a Will?

John Maher: Okay. All right. So that's the first step would be making sure that you use an attorney and then will they just sort of take care of the whole process for you? Is there anything else to it?

John Brennan: There'll be sort of a questionnaire. They'll ask who you're related to. That's important because one of the things... I'm going to sort of spin ahead, because I know you're going to ask me about tips about wills. One of the things to bear in mind is about half of Americans have a will, half of American adults, and it skews, the older you are the more likely to have a will.

So just in terms of tips, you want to have something because without a will, your wishes will be decided by laws of intestacy. So you have a will whether you like it or not. And if you don't have a will, your will is what's the law on the books. And that is really determined by your relatives. There's this notion of blood relations. It's going to dictate where your property is going to go.

Another sort of celebrity example is Prince. Famous musician, dies at age 57, wealthy, lots of property, lots of intellectual property. And he has his music catalog, which he's created. And what happened with his property since there was no will and there were no statements to where he wanted his property to go, it was divided between his siblings and his half siblings. Some of which he really might not have had much of a relationship with. I really don't know, but that's the notion that they're going to look for a blood relative and they'll find one somewhere where they can then give the money to.

Intestacy Laws: Dying Without a Will

John Maher: And is there some sort of progression there where if you have a spouse that would be the first place it would go to, if you have kids that would be the second place that it would go to, then maybe it would go to siblings and half siblings? Is there a progression like that?

John Brennan: John, you're onto something. You're exactly right. I mean, that's essentially how it goes. It's really going to go by who's closest to you. And it's going to keep working out just like rings on a stone dropped in the water. It's going to go farther and farther out until it finds someone.

John Maher: Right. And that's what would happen if you don't have a will set up. So therefore, that's why it's really important, especially if you have a different idea of where you want your property to go, you need to be able to specify that in a will.

John Brennan: Hey look, the other thing too, I will point out. I understand procrastination, right? A lot of people procrastinate. At the very least, you need to be aware that if you don't have a will to make sure your beneficiary forms are in order. If you have a beneficiary for your 401k, a beneficiary for your IRA, life insurance you might have through work. That's the beginnings of your estate plan. Because I can see a 25 year old saying, what do I need a will for? Chances are, the demographics, they shouldn't be dropping dead of a heart attack anytime soon.

John Maher: Sure.

Why Parents Need Wills

John Brennan: But for those people, you could kind of get away with less and just hope for the best. But certainly once you have a child, you want to have a will. And one of the reasons why is that the guardian of your child will be appointed by your will.

Where your physical property, like your personal property will go, is determined by your will unless you really give it to your trust. And also, wills often deal with specific gifts, my fishing poles, my favorite guitar, my pet, things like that the will usually handles. And so those are all the reasons to have one.

Final Tips on Wills

John Maher: Right. Any other tip or final thoughts on wills?

John Brennan: I think that's that. I think the big one is to get one. And I think one of the challenges why people don't have wills is because it's not always clear to them. Lawyers aren't necessarily popular in our culture because their billing is opaque and people don't always understand. It's not like there's a special on wills today.

John Maher: Right.

John Brennan: So I think people are always... that makes them a little nervous. Attorneys make people nervous, and then the sort of clarity about pricing can also trip people up. But if you have a kid, if you're married, if you have really any kind of property, if you own a house, it's really a good idea. It's not something you'd maybe look forward to, but it's a very good idea to get.

John Maher: All right. Well, that's really great information, John. Thanks again for speaking with me today.

John Brennan: Sure thing, John.

Contact Cape Ann Savings Bank Today

John Maher: And for more information, contact Cape Ann Savings, Trust and Financial Services at (978) 283-7079, or visit the website at capeannsavings.bank.

Investments purchased through the Cape Ann Savings Trust and Financial Services Department are not FDIC insured, not FDIC, guaranteed, not bank guaranteed, and may lose principal value.