So Maybe Your Son-In-Law or Daughter-In-Law Aren’t What You Expected…How Do You Make Sure They Don’t Receive Your Assets?
I have had many clients who love their children but aren’t so enamored by their children’s choice of spouse (to be fair MANY clients love their childrens’ spouses but this blog discussion does not address those situations). If a parent, at their death, provides for distribution of assets outright to their children, they risk those assets ending up in the hands of the children’s spouse, either through a gift by the child, death of a child or a really good divorce attorney. So what is a parent to do?
In these situations a trust is the first estate planning document to consider. You can keep assets in a trust and have those assets available for your children but restrict access from their spouse. These trusts must be carefully drafted and there MUST be a trustee who is competent and trustworthy. In many cases a corporate trustee may be the choice of trustee. If a corporate trustee is selected you may also do a “letter of wishes” to the trustee which is not public but helps guide the trustee as to your overall intent.
You also need to think carefully about assets, such as a homestead, which may be distributed to a grandchild (because a child has predeceased the parent) and may be required to be distributed to a court authorized guardianship (because the asset can’t be placed in a trust). Normally the biological surviving parent is the guardian assuming the biological parent is not “unfit”. You can make suggestions as to whom you want to act as guardian or provide for alternative dispositions.
Another suggestion is to have your children prepare and execute a prenuptial or post-nuptial agreement which provides that their spouse waives all rights to any inheritances whether in trust or otherwise. Obviously if your child is already married, then this suggestion may be a touchy subject, if not cause all out war! If your child is not already married you can make the suggestion blaming the suggestion on your attorney! Much better that a child and their spouse dislike the attorney rather than the parent :).
ADVICE: We all want to love our child’s spouse but unfortunately that is not always the case. Also you may love the current spouse but will you love a future spouse? These are tough topics that must be discussed with your attorney.
GENEROSITY IS A KEY TO HAPPINESS …REACH OUT AND HELP SOMEONE TODAY!