My father recently told me that he wants to marry his girlfriend soon, and I'm concerned that he is rushing through estate planning, especially regarding his children's inheritance. My father is 48 years old, and his wife from his second marriage died of cancer three years ago.
He was devastated, and I'm glad he found someone who makes him happy. His girlfriend is 49 years old and they have been dating for 1.5 years. I think it's great that they want to get married; However, I want my parents and family to be prepared and financially protected.
My family was very close knit. My grandfather owned two large companies as well as large real estate, and my parents, aunts and uncles all worked for him. We had family dinners weekly, spent holidays together and all went on family vacations.
My grandparents died of cancer in their mid-50s. My father and his siblings received a large inheritance, but the distribution of the trust completely tore him and his siblings apart. The siblings no longer talk to each other or have any role in each other's lives.
It was absolutely devastating to lose our family dynamic, and has been that way for years since. The last thing I want to happen is for something similar to happen again. When my father told me he wanted to get married, I felt like I needed to have an uncomfortable conversation about his assets.
Not an “early” marriage.
He is very private about his finances, so it is uncomfortable to talk about it. He told me he had a trust that owned everything — real estate and investment accounts — except for a few personal cars. He feels protected without a prenuptial agreement.
I'm only 23 and I want some advice about having this conversation with my dad. When he sells the company or any of his property, is he technically selling the trust for it? If they divorce, is she entitled to any of it?
If he died before her, what would happen if she was not trustworthy? What other questions should I ask? Where is the line between wanting to be prepared and also respecting his privacy? I want to protect my family for the future.
I don't think his girlfriend has any bad intentions. However, my siblings and I are all grown up and I don't think she is entitled to his estate in the same way as an early marriage. I see her as my father's partner and I'm so grateful that he has that.
I don't see her and her children as deeply integrated into our family as a stepmother, nor do I consider her children to be my siblings. Thank you for any advice you give me, and for everything I've learned from reading your column.
the daughter
See also: My partner is against marriage. I'm not on the title to his house, but he set up a revocable trust in case he died first. Is this too risky?
“He may view your questions as casting doubt on his fiancée, assuming she is in the first flush or romance.”
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my dear daughter,
Think carefully before you speak. It is a very sensitive topic.
First, the good news: Your feelings toward your future stepmother and her children may change, and you may welcome them into your family as warm personalities with a lot to offer. Now, the bad news: The terms of your parent's trust and last will and testament can also change.
This is why it is important for you to proceed with caution if and/or when you decide to inquire about his assets, and how he intends to build a will or trust. He may view your questions as casting doubt on his fiancée, assuming she is in the first flush or romance.
It is a sensitive and special time for your father. The nature of romance – the early days, months and even years of a relationship – often means that a person often idealises their partner, seeing them as disconnected from the harsh realities of everyday life. This may also lead to overprotection.
Leave your feelings about your parent's partner and her children out of the loop. He clearly loves her, and it doesn't matter whether you consider this an “early” marriage or not and look at it in a different light. At 23 years old, 49 may seem old. But they could spend four decades together.
Stick to the facts, don't make any personal comments, and be honest about what happened to your father and his siblings. It's not an unusual concern. About $16 trillion will be transferred from older family members to Millennials and Generation X over the next decade.
“Assets in the trust are not subject to equitable distribution unless they contain marital property,” Jewell Law says. “Any money paid from a trust to the beneficiary spouse remains separate property provided it is kept in a separate account and not commingled with marital funds.”
Prenups add protection
Remember, no one is entitled to anything. Start the conversation off right by saying that a prenuptial agreement can help your future “stepmother” as much as it can help your father, and outline how it can serve as a supplement to a revocable trust, outlining other financial issues in more detail.
Your father has already taken steps to set up a revocable trust for his children, which should protect those assets from any claims from his third wife in the event of divorce. Unlike a prenuptial agreement, he does not need his girlfriend's signature to do this.
However, I support trusting both And Pre-marriage. A prenup should be established before the wedding day with an attorney. It can also address problems that a trust cannot. This includes documenting your assets and liabilities before marriage, and how they will be divided in the event of divorce.
Prenups are useful for alimony and child support. They can also explain what happens to the property if, for example, your father dies. He could decide to give her a life lease, meaning to live in the house for the rest of her life. Some states even allow “no cheat” clauses.
He must update the beneficiaries on his 401(k) and IRA, and on other accounts he wishes to avoid probate, and a general accounting of his assets and liabilities. However, some experts advise placing brokerage accounts in a trust to avoid triggering any probate limit in your state.
You can be encouraging, practical, assertive, sensitive, practical, and helpful. Your father has been through a lot, and you are also getting used to having these new people in your family, but in the end it is your father's life, so know when to give your father his space.
You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter.
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