- Home
- My...
My estate is worth millions of dollars. How do I stop my daughters’ husbands from getting their hands on it?
Dear Moneyist,
My wife and I live in California, as do three of our four grown daughters. We are revisiting our family trust for the first time in many years, as we’re getting older and have gradually built an estate worth a couple of million dollars. We want to make sure that, in case our daughters get divorced, our hard-earned savings go to them and not their ex-husbands.
We consulted with two estate attorneys and got different answers. The first said there’s nothing we can do to legally enforce that the inheritance stays separate; the most we could do is put in some wording along the lines of “It is our wish that the money stays separate.” The second attorney said that we can make our children sign a prenup as a condition of their inheritance.
Furthermore, we have one daughter who has already been married for five years and has three children; another daughter who just got engaged; and two other children, who are single. Our married daughter does not have a prenuptial agreement. How do we protect our gift to her? A retroactive prenup? How should we proceed?
Father of Four Girls
Dear Father,
Money should bring freedom and opportunity, not control and coercion.
Your intentions tread a fine line between expectations and legality. There is only so much you can do to prevent your daughters from sharing their inheritance with their spouses, assuming they all marry and some of those marriages end in divorce. It is a credit to you that you have amassed a couple of million dollars, but don’t allow this money to become a cudgel with which to pull the purse strings in your daughters’ lives.
One solution to your problem: You could set up a bloodline trust, a revocable trust that sets out how you should leave your assets to your direct beneficiaries — in this case, your daughters — and which becomes irrevocable upon your death. It can only be used for your daughters and their children, and because it becomes irrevocable upon your death, it cannot be accessed by creditors, should you have any. There are downsides. For example, such a trust could, unless otherwise specified, exclude stepchildren and adopted children.
First, the good news: Inheritance in California is considered separate property. Whether you leave your children real estate or brokerage or savings accounts, that money will remain nonmarital property unless your daughters use it to upgrade their family home or in some other way commingle those assets with their community property. So that pre-empts the need for your married daughter to ask her spouse to sign a postnuptial agreement.
On that subject, however, it’s not wise to use this inheritance to tell your daughters what they should do within their marriages. There should be a clear boundary between your relationship with your adult children and their relationships with their respective partners and spouses. It’s not a good idea to interfere in the latter. Doing so may cause discord in their relationships and also cause unnecessary hurt and tension in your own relationships with your daughters.
“California is one of a few states that strictly adheres to community-property laws, which declare that assets acquired during a marriage [are] community, also known as marital, property,” according to Myers Family Law in Roseville, Calif. “However, even California draws a line when it comes to personal inheritances, including inheritances that were received while married. Inheritances are treated as separate property, belonging to the individual who received the inheritance.”
Legal gymnastics
Requesting in your last will and testament that your daughters receive their share of your estate on the condition that they don’t share any of it with their husbands presents a lot of impractical and legal gymnastics. What they do with their inheritance is their business, unless you put those assets in a trust with strict instructions on how those assets should be used — for your grandchildren’s education, for example — or use the trust to provide an annual income.
There are so many variables beyond your control. What if you die before your wife, and she has different ideas about how your joint estate should be settled? What if your daughter’s husband is asked to sign a prenup, and replies, “No way — who does your father think he is?” The best course of action is to make your daughters aware of how to manage separate assets that are inherited, and how they could be accidentally commingled.
Think about the quality time you have left with your family. You don’t want Thanksgiving dinners to turn into a battle royale or, worse, a situation where your daughters and their partners gradually pull away and reevaluate their relationships with you. You have worked hard for your money, and you are attempting to protect your family fortune. But there are times in life when you can do too much, and hold your family too tight, even if that is not your intention.
Ask yourself some soul-searching questions before you proceed. Do you really want to force your children to sign a prenup in order to receive their inheritance? Prenups can be challenged and changed at a later date. What is more important: the couple of million dollars you will leave behind, or the relationships you have with your daughters while you are still here? Don’t put a price on your daughters’ love for you — or on their love for their spouses.
Sorry for being preachy, but even Shakespeare wrote a play about estate planning. It was called “King Lear.”
The Moneyist regrets he cannot reply to questions individually.
Previous columns by Quentin Fottrell:
- https://www.msn.com/en-sg/money/personalfinance/my-estate-is-worth-millions-of-dollars-how-do-i-stop-my-daughters-husbands-from-getting-their-hands-on-it/ar-BB1iaSAD?ocid=00000000
Related
Have $500,000 in Retirement Savings? Here’s How Much You Could Spend per Year
For a comfortable retirement, 26% of overall Americans said they would need anywhere from $500,000 to $1 million. This key takeaway comes from a GOBankingRates January 2024 survey polling 1,005...
MoneyWhy the company behind Jeep and Dodge will no longer offer chrome in new vehicles
Stellantis, the maker of Jeep, Dodge, Maserati, and Fiat vehicles, plans to no longer use chrome in new cars.
MoneyJohn Deere unveils new farming equipment that could change the face of agriculture as we know it: 'This is similar to proven technology'
"Sooner than later, the sheer economics of battery power will make switching a no-brainer." John Deere unveils new farming equipment that could change the face of agriculture as we know it: 'This is similar to proven technology' first appeared on The Cool Down.
MoneyI became a millionaire at age 27—here are 4 'unpopular' rules rich people follow that most don't
Your Rich BFF founder and self-made millionaire Vivian Tu reveals the "rich people habits" that made her a millionaire.
MoneyAs a Senior, When Can I Stop Paying Property Taxes?
As a senior citizen, you probably will end up paying property taxes for as long as you are a homeowner. However, depending on the state you live in and often once you hit your 60s (usually around the ages of … Continue reading → The post At What Age Do Seniors Stop Paying Property Taxes? appeared first on SmartAsset Blog.
Money3 Reasons Retirees Could Be Surprised by the Most Recent 2025 Social Security Cost-of-Living Adjustment (COLA) Forecast
Stubborn inflation has led to rising COLA projections, but seniors may still be surprised.
MoneySquatters Can Legally Steal Property in 21 States: Here’s How
Property ownership is a cornerstone of the American dream, and some people are fortunate enough to own or inherit multiple properties. However, what seems like good fortune can quickly turn into a headache if managed incorrectly. Through this article, we will outline the adverse possession laws that work in favor of squatters and ultimately allow them to claim ownership of your property. See where your state lands on the list and what you need to do to protect your real estate.
MoneyHow America's largest buffet survived the death of all-you-can-eats
The buffet was a quintessential all-American idea: lots of food at a low price. It took off through the 1980s, but in the 2000s, the restaurant concept struggled to keep up in an era of fad diets. The COVID-19 pandemic certainly didn't help. But Shady Maple, in East Earl, Pennsylvania, has come out thriving. On a Saturday, 8,000 people wait in line to chow down on its traditional Pennsylvania Dutch fare. Producer Abby Narishkin goes inside the kitchen and takes a seat herself to see if this place really is good enough to be one of the few buffets left standing.
Money