Who should I consult regarding how to leave (divide up) the assets to my wife plus a

[1-31-18]

Thanks all. There is no intention of taking away wife's portion of the assets. While I was the only earner of the family, we are a 50/50 couple. I love my wife dearly, more than my niece and my nephew. I absolutely want to make sure that she is taken care of, I do worry about this, but the 33% should take care of it. More concern than financial is how she is going to cope mentally with the situation should I passed first. We often think about the financial aspect because it is important to a day to day living, I think we need to pay more attention to the mental aspect of the situation as well especially those of us who do not have kids of our own.

Your feelings and thoughts about this are completely irrelevant if you live in a state where your wife is entitled by law to at least 50 percent of the marital assets upon your death, unless she simply permits this to happen without challenging it. TOD instructions, wills and other directions made without her written consent, given before or after your death, are ineffective if the law of your state gives her a 50 percent or greater share. Illinois is such a state. I don't know about yours.

 

[tmm99]

Your feelings and thoughts about this are completely irrelevant if you live in a state where your wife is entitled by law to at least 50 percent of the marital assets upon your death, unless she simply permits this to happen without challenging it. TOD instructions, wills and other directions made without her written consent, given before or after your death, are ineffective if the law of your state gives her a 50 percent or greater share. Illinois is such a state. I don't know about yours.

Maybe the wife needs a separate lawyer to represent her interest - It is a type of postnuptial agreement, no?

 

[Car-Guy]

"In my experience" bank accounts are easy (ex. checking, savings, CD's), you can name one or more POD beneficiaries per account. (that seems to work very well without getting lawyers, wills and the courts involved). I've never dealt with a TOD brokerage account so I can't comment. Real property transfers can get more complicated (things with titles or deeds) so best to consult with a local estate lawyer.

 

[athena53]

Maybe the wife needs a separate lawyer to represent her interest - It is a type of postnuptial agreement, no?

I wouldn't say it's that complicated. Postnups and prenups can go on for pages and include multiple "if-then" scenarios and certainly each party should have his/her own lawyer.

In the OP's case, if she knows that she'd get 1/3 of $X (and she knows how much $X is now), it's not that complicated to understand that she might be entitled to 1/2 of $X under the state laws and she's waiving that right.

 

[Sunset]

Sunset, I can assure you that she will never ever have to worry about money.

Good to hear, so why not give the niece and nephew $$$ now since it's not needed ?

As a couple you can give them $28,000 per year with no tax implications, after all you might last another 20 years so the amount would really build up, and it would give you time to see if they use the money wisely or blow it all on parties and booze. An indicator of what they will do if/when they get the big stash.

 

[GravitySucks]

Yes, Parties and Booze are the perfect use for unearned money.

 

[evilanne]

If the current portfolio would be subject to estate taxes, OP's plan makes sense if one spouse dies; the allocation to the other beneficiaries will reduce the overall future estate and lower tax impact in the long run. At this point in time, this is not an issue in my situation since I'm well below estate tax threshold. With potential changes in tax code none of this may matter in the future but if my assets increase substantially, I would rather gift or donate money to ensure I'm below any future threshold. One option not considered would be to educate spouse or a designated beneficiary or executor how to handle financial accounts and outline strategies/options that would best take care of the other spouse to lesson any burden by having someone to take care of the issues for the spouse. I'm not current on the intricacies of legal aspects so getting professional input is advisable as well as discussing every issue with family members so they is aware of ultimate goals and your wishes when something happens.

 

[1-31-18]

Maybe the wife needs a separate lawyer to represent her interest - It is a type of postnuptial agreement, no?

Correct. But if I were her, or if I represented her, then I would simply wait until the OP dies and at that point assert legal right to 50 percent (or more) in court. One spouse has no legal right to cut back the other spouse simply because the one feels the other deserves less. She can ignore her rights or waive them, or instead assert them -- now or later.

 

[Lstansbury]

Echo "it depends on the state.". In my state, a community property state, I own 50 percent of the household estate, but nothing more. Without a will, all my husband's assets go to blood, including half the house I'm living in. I can't sell the house or refinance the house without their permission. If I move anyone else into the house, his children from a previous marriage (co-owners​) can toss me and the other person out​. However, I have the fiscal responsibility of maintaining the home, the other owners do not. If we finally all agree to sell it, and at a particular price that everyone agrees to, then the co owners share in the profits. I can tell you horror stories galore of property title so convoluted by this craziness that property estates are in probate for decades and decades. In my case, my own sixteen year old daughter blocked me from selling my home after my husband died. I couldn't maintain the big ole house on my own. But she didn't like the idea of it being sold. So I tried to just refinance it to get enough money to pay some of the upkeep. I had to go to court to get a tutor named for her so that the tutor could give me her permission to refinance. For goodness sakes, give the surviving spouse full ownership of the house.

 

[athena53]

I can tell you horror stories galore of property title so convoluted by this craziness that property estates are in probate for decades and decades.

Ah, I see you're in Louisiana. When I did my first DIY will, I used Willmaker software. They had a disclaimer that said that laws in Louisiana are based on the Napoleonic Code and that the will generated by Willmaker wouldn't be valid in LA so if you lived in LA they'd refund your money.

Your story DOES reinforce the point that dying without a will is a bad idea and you need a darn good lawyer to draw one up if there are multiple heirs involved. You used the term "tutor" but I think in most states it's called a "guardian ad litem"- more bureaucracy and more expense that might be avoided with a will.

 

[pb4uski]

Correct. But if I were her, or if I represented her, then I would simply wait until the OP dies and at that point assert legal right to 50 percent (or more) in court. One spouse has no legal right to cut back the other spouse simply because the one feels the other deserves less. She can ignore her rights or waive them, or instead assert them -- now or later.

You folks who are all excited about the wife getting 33% vs 50% are missing an important fact... both the OP and the wife want the 33/33/33 split... the wife is not pressing to get more than 33%.

It is not that the OP feels that his wife deserves less than 50%... it is that they have jointly agreed that she will get 33%.

Finally, I'm not lawyer but if she waives her right I don't think she can later renege and assert them later.

 

[1-31-18]

You folks who are all excited about the wife getting 33% vs 50% are missing an important fact... both the OP and the wife want the 33/33/33 split... the wife is not pressing to get more than 33%.

It is not that the OP feels that his wife deserves less than 50%... it is that they have jointly agreed that she will get 33%.

Finally, I'm not lawyer but if she waives her right I don't think she can later renege and assert them later.

Does she "really" want less than her full share, or is she acquiescing in her husband's plan because she is unaware of her rights and mistakenly believes she has no choice (or doesn't want to rock the boat)? That would be a bad situation for her in my opinion.

If on the other hand the wife knows what she is giving up and genuinely wants to accept it, then a written waiver, supported by a quid pro quo, generally would be required to make the arrangement legally enforceable. An oral waiver assertedly given for nothing in return is generally unenforceable, particularly if real estate is involved.

I am not offering legal advice to anyone who reads this -- just stating basic principles of law of general applicability. The OP and his wife should consult and work with competent legal counsel in their home state, in my judgment.

 

[pb4uski]

For all you know, her 1/3 share might be multi-millions of $.... or perhaps it is a second marriage and she is independently wealthly to begin with so 1/3 is fine with her.

OP has been clear that DW is on-board and will have plenty of money... why not accept the OP's assertion rather than stick your nose where it doesn't belong? Fine to mention that she is entitled to 50% under state law but no need to keep banging that drum.

 

[littleb]

For all you know, her 1/3 share might be multi-millions of $.... or perhaps it is a second marriage and she is independently wealthly to begin with so 1/3 is fine with her.

OP has been clear that DW is on-board and will have plenty of money... why not accept the OP's assertion rather than stick your nose where it doesn't belong? Fine to mention that she is entitled to 50% under state law but no need to keep banging that drum.

You are correct it is nobody's business if he wants to leave her 1/3 of his assets.

Maybe people see the same or similar situations in their own lives and wonder if she understands and will be protected.

My FIL designated his pension with no survivor benefits and when he died my MIL had nothing.

I know three different women today who have no or very limited assets in their names. Two of them are young in their early 30's and the other one is in her 50's. Their houses were purchased by the spouse and their names have not been added. The houses were bought after two of the relationships existed and the men never added their spouse to the title. The other house was purchased under an LLC tied to the spouses business (excluding the wife). All of these women have children and I worry if they would be protected should the relationship fall apart. These women are financially naive and the men handle everything. Based on the states where they live and their names not on the house title they could become homeless if certain events occurred.

I want to pull these women aside and tell them they need to look out for their future in case of death or divorce. However, it is none of my business so I am concerned from a distance.

 

[googily]

Speaking as someone newly minted in your DW's situation....

DH died earlier this year, and we have no kids. We went to an estate attorney in 2015 and set up wills and trusts, and also redid a slew of individually held brokerage accounts at different companies, moving all of them to Vanguard and holding them JTWOS (though he was the primary owner on one of them, and I was the primary on two others).

The house is jointly owned (entirety), and by law we were each other's 401k beneficiaries, as well as pension beneficiaries. It was decided that his old rollover IRA and company life insurance would go to his siblings via beneficiary/TOD designations.

It was also then written into our wills and trusts that everything else would go to the surviving spouse, and that the surviving spouse would then leave everything to all the siblings and nieces and nephews.

We of course did not do all of this planning with the expectation that it would kick in less than two years later. But it worked out really well in that his siblings are splitting low-six-figures now, instead of having to wait until I kick off before they see anything. The nieces and nephews are still young, and so it's not a bad thing that nothing went to them in this round.

I now though have to redo all of the beneficiaries, deciding which pots of money should go directly to my trust and which ones should be TOD. House will be retitled to be owned by my trust, as will the taxable brokerage account. But the inherited IRA from DH's 401k and my own rollover IRA should be left to individuals, not my trust, so I am figuring that out. Thank heavens Vanguard lets you do that online.

Now, I could live another 40 years and have five more husbands, and we didn't write the trusts so that I am required to leave anything to his family, since I can rewrite mine at any point. But I seriously doubt I will ever marry again, and it might be good to have his nieces and nephews to maybe want to be nice to me when I'm old, if they think there's something coming.

I don't know how involved OP's DW is in the finances of the house, but I was pretty much the driver of the estate stuff and the brokerage stuff, so I have a much deeper knowledge of all of this than she might have or want. And to be honest, it's given me something to do in the midst of such a terrible time.

And one other vote for the estate attorney--ours is priceless to me *now* for the handholding about what needs to be done, when. Don't discount that when thinking about whether to go to one. It's not just about whether you think you need help with the planning, it's about whether you think DW will need help with the execution.

 

[1-31-18]

For all you know, her 1/3 share might be multi-millions of $.... or perhaps it is a second marriage and she is independently wealthly to begin with so 1/3 is fine with her.

OP has been clear that DW is on-board and will have plenty of money... why not accept the OP's assertion rather than stick your nose where it doesn't belong? Fine to mention that she is entitled to 50% under state law but no need to keep banging that drum.

The ideas in your first paragraph ignore the wife's legal rights. Sorry, but she's still entitled to a statutory share, even if the couple (or she alone) is rich and even if she's a second (or fifth) wife, unless she waives part or all of her statutory share in writing before or after her husband dies. Even if she "will have plenty of money," as you put it, she has rights.

The OP says there is no will or trust, so I think it's a safe bet that there is no written waiver, either.

People who don't like laws that conflict with their own ideas about what's appropriate sometimes ignore those laws and create bigger problems down the line. I'm not saying the OP fits in that category. On the contrary, it seems like he wants to do the right thing, as he asked whether he should see a CPA or a lawyer. The correct answer is that he and his wife should see a lawyer, who will advise her of her rights and then (if she is willing to waive her rights) will document her waiver to preclude a dispute after the OP passes.

I have no hesitation about advising consultation with a lawyer when someone has a legal issue that needs attention. That's all I intend to say about this topic. Over and out.

 

[pb4uski]

....That's all I intend to say about this topic. Over and out.

Praise the Lord. You are totally off-base.

I did not ignore that the wife might be entitled to 50% under state law.... but the OP has indicated that she has decided (for whatever reasons, wise or unwise, informed or ignorant, coerced or not) to waive her right to 50% and accept 33%. It may well be that in the OP's specific facts and circumstances that his DW has concluded that 50% is not equitable and 33% is. Again, we don't know.

You presume that she has been coerced or somehow taken advantage of... that may be the case...we don't know... there could be good reasons.

I know plenty of happily-second marriage couples who keep their finances separate and one party would be perfectly fine with 33% (or even 0%), even though they state law entitles them to 50%.

It seems that in this thread that the only ones who are so intent on the wife claiming 50% she is entitled to are the bloody lawyers.

 

[Lstansbury]

Just weighing in here... I never presumed that anyone was being coerced. And as someone who is on the brink of a second marriage...I have agreed verbally to a less than 50 percent split . But my SO and I are aware that we have to put all this in writing. Nothing I agree to verbally or in writing can supercede the state law. Waiving my rights has to be done in a particular way, or it won't stick. Also, I am negotiating other benefits lieu of the waived rights. Those will be in writing, in appropriate form, recorded where necessary to o stand up I'm court. There are grown children in the mix with large issues and I need protection. As does he.