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Moneyist: My wife made her sister 401(k) beneficiary. I asked to be listed in case she dies first — she promised her sister would ‘give me the money.’

justice denied

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"All of my accounts have her as the beneficiary, and our will lists her to get everything we own if I should Die"​

My wife and I had a great year this year. We intend to max out both of our 401(k)s and IRAs, and my solo 401(k) from my self-employed business to remain under an income limit for school choice. Previously, I have encouraged my wife to convert her 401(k) to a Roth 401(k) during low income years.

She advised me that her 401(k) was from her post-college, pre-marriage years and she had an emotional attachment to it, and therefore did not want to touch it. As part of this new tax planning, I found out that the $100,000 in the old 401(k) is still in her maiden name, and her sister is her beneficiary.

I asked her to change the beneficiary to myself because if she dies, I will need that money to raise our four young kids. She says that her sister “will give me the money,” and asks, “You don’t think she will give you the money?” like it is some type of trust issue.

We are almost 40, and have $150,000 in Roth retirement funds and $600,000 in rental-property equity. All of my accounts have her as the beneficiary, and our will lists her to get everything we own if I should die. What should she do — and what action should I take?

Surprised Husband

 

Plutonian

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If you are married, you have to sign a document that you are OK having someone else be the beneficiary. Spouses come first. This sounds illegal.
 

Diggin da Shamy

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If you are married, you have to sign a document that you are OK having someone else be the beneficiary. Spouses come first. This sounds illegal.

Not with mine. I just listed my mom. My mom has me as hers as well even tho my parents been married for over 30 years. Maybe it depends on state, but you can list anyone as long as you have their social.
 

anaisnin

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If I were him I would change all his beneficiaries to his kids or, better yet, into a trust and assign an executor, but I’m a petty b!tch. Her sister instead of the kids? That’s just weird. I get it’s pre-marriage money, which is why if you don’t want to do him, you do the kids. I don’t get it.
 

Winterwonderland

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That wife is so naive to think that the sister will just give up the money. I get trust issues, but why not list the children as beneficiaries instead? This would have been okay if the woman was single and only had her sister as next of kin, but she now has 4 kids who will be at the mercy of their auntie should their mother ever die.
 

GrandMarquis

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out of all the things to be worried about.

why does it have to be in his name? Why not out in the kids name?
 

Silkky

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Wife is FOS. she has that money in her sister's name for a reason.

Reminds me of a reddit story where the OP's brother left him over his estate/trust for his son instead of his wife. He died, the wife got remarried to an ahole and became a complete doormat(maybe she always was).

Wife became pregnant with new husband's child and asked op for a favor for the new baby (long story); OP said no. The first thing the new husband says is "That's fine. We'll just get the money for it from the trust". The poster was like "Uuuuh, no ya won't. That money is for my nephew". Apparently, the wife hadn't told him that any money taken from the trust had to be approved by the brother first. Had the deceased brother not left his sibling over his trust, I don't doubt his son's money would have been ran through by the time he became an adult. New husband was already talking like the trust was his personal piggy bank. This guy's wife might feel like she is protecting her kids the same way.
 

ilikebeer12345

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Wife is FOS. she has that money in her sister's name for a reason.

Reminds me of a reddit story where the OP's brother left him over his estate/trust for his son instead of his wife. He died, the wife got remarried to an ahole and became a complete doormat(maybe she always was).

Wife became pregnant with new husband's child and asked op for a favor for the new baby (long story); OP said no. The first thing the new husband says is "That's fine. We'll just get the money for it from the trust". The poster was like "Uuuuh, no ya won't. That money is for my nephew". Apparently, the wife hadn't told him that any money taken from the trust had to be approved by the brother first. Had the deceased brother not left his sibling over his trust, I don't doubt his son's money would have been ran through by the time he became an adult. New husband was already talking like the trust was his personal piggy bank. This guy's wife might feel like she is protecting her kids the same way.
And here we mother fµck!ng go. Wife knows exactly wtf she doing.
 

ilikebeer12345

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"All of my accounts have her as the beneficiary, and our will lists her to get everything we own if I should Die"​

My wife and I had a great year this year. We intend to max out both of our 401(k)s and IRAs, and my solo 401(k) from my self-employed business to remain under an income limit for school choice. Previously, I have encouraged my wife to convert her 401(k) to a Roth 401(k) during low income years.

She advised me that her 401(k) was from her post-college, pre-marriage years and she had an emotional attachment to it, and therefore did not want to touch it. As part of this new tax planning, I found out that the $100,000 in the old 401(k) is still in her maiden name, and her sister is her beneficiary.

I asked her to change the beneficiary to myself because if she dies, I will need that money to raise our four young kids. She says that her sister “will give me the money,” and asks, “You don’t think she will give you the money?” like it is some type of trust issue.

We are almost 40, and have $150,000 in Roth retirement funds and $600,000 in rental-property equity. All of my accounts have her as the beneficiary, and our will lists her to get everything we own if I should die. What should she do — and what action should I take?

Surprised Husband

You don't get a damn dime husband unless A) you never remarry and B) get a vasectomy. No in fact a whole and complete physical sterilization with complete removal of both balls and scrotum !


U ain't gonna be out here populating the earth with a slut on my money, husband
. Women ! Take a lesson from this lady.
 

Sarah330

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When I get married I honestly wouldn't leave anything to a husband. If I had kids I would leave it in their name with my mom to look over it. Overwise I would leave everything to my mom and she will give my husband something if that's what she wants to do. Idk, men are funny with money and I just wouldn't do it..
 

redbud tree

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She's probably emotionally attached to the idea that she earned the money herself before marriages, and this is part of the bond with her sister.

And frankly, making sure her husband gets the money isn't a priority for her. She seems like a woman who is about her business, so if it was important, she'd fix that.
 

SlowYourRoll

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Wife is FOS. she has that money in her sister's name for a reason.

Reminds me of a reddit story where the OP's brother left him over his estate/trust for his son instead of his wife. He died, the wife got remarried to an ahole and became a complete doormat(maybe she always was).

Wife became pregnant with new husband's child and asked op for a favor for the new baby (long story); OP said no. The first thing the new husband says is "That's fine. We'll just get the money for it from the trust". The poster was like "Uuuuh, no ya won't. That money is for my nephew". Apparently, the wife hadn't told him that any money taken from the trust had to be approved by the brother first. Had the deceased brother not left his sibling over his trust, I don't doubt his son's money would have been ran through by the time he became an adult. New husband was already talking like the trust was his personal piggy bank. This guy's wife might feel like she is protecting her kids the same way.

This !!! The wife is smart, I've heard too many horror stories, she's not making the man beneficiary for a reason. I've heard of too many spouses that re-marry and leave everything to the new spouse thinking s/he will take care of the kids, in one case the woman died , left everything to her husband and instead of using it to take care of the kids as promised, he took the money and put the kids into foster care and left.

Besides I'm kinda leery of a man that is so preoccupied with money that can only be accessed when I die, Sir, stop worrying about money accumulated before we met
 
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CruzanRum

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When i googled beneficiary for 401k it says "spouse must sign a waiver consenting to name someone else as beneficiary". If she is legally married her husband will get the money. 401k plans are governed by federal law.
 

Ataraxic

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The 401k was before the marriage, so the wife isn’t wrong. Wife shouldn’t be the beneficiary on his pre-marriage policy either. Only accounts they have together.
 
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Mrs.Giroud

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I support her choice! But I’d leave it to the kids with her as an overseer until they’re adults. Any woman that leaves money to her husband is stupid
 

violette1984

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Good for her. Women should always try to have a pool of money just in case something happens. We'd be smart not to comingle premarriage funds. A new spouse can pop on the scene like a shark when blood's in the water and take everything.
 

LalaSharp

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If she wanted to keep her 401k, she should have had him sign a waiver and created a prenuptial agreement clarifying which of her premarital assets she wanted to keep.
401k stock accounts have had significant growth in the last few years. Even if the 401k was premarital, is the growth? They've been together long enough to have 4 young kids.

Leaving it to her sister instead of a trust for her kids with her sister as the executor/trustee is a bad move if her intent is for it to go to the kids.
 

orchidsinyellow

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If you are married, you have to sign a document that you are OK having someone else be the beneficiary. Spouses come first. This sounds illegal.
I believe this is true if the retirement plan falls under ERISA . Under ERISA your spouse must be a beneficiary but not all plans are subject to this.
 

nivvie

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He sounds way interested in her money when he should be focusing on other things to build wealth or invest in insurance plans instead, if he’s so worried about the both of them dropping dead anytime soon. Weirdo.
 

violette1984

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If she wanted to keep her 401k, she should have had him sign a waiver and created a prenuptial agreement clarifying which of her premarital assets she wanted to keep.
401k stock accounts have had significant growth in the last few years. Even if the 401k was premarital, is the growth? They've been together long enough to have 4 young kids.

Leaving it to her sister instead of a trust for her kids with her sister as the executor/trustee is a bad move if her intent is for it to go to the kids.
I had one opened before they married. Let's be honest for a minute, some men get an inch and leave. Having money like that is a safety net most women would be lucky to have. What if a man gets physical and you need to run? There's a pool of money you can tap even if there's a penalty to remove it. Better to have the option.

We also don't know the circumstances of the husband's spending habits. Maybe he's the best guy in the world but gambles or makes bad investments. Lot of reasons to have arrangements like this. I just hope the wife has some kind of will or notarized statement.

I had some accounts that I kept separate when I got married. I'm glad I did because I didn't have to split it when I got divorced.

edit:typo
 
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mekap31

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My beneficiaries are my adult children. My husband will not be wining and dining some woman on my savings. LOL

By the way he is aware and has no problem with this.
 

mekap31

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If she wanted to keep her 401k, she should have had him sign a waiver and created a prenuptial agreement clarifying which of her premarital assets she wanted to keep.
401k stock accounts have had significant growth in the last few years. Even if the 401k was premarital, is the growth? They've been together long enough to have 4 young kids.

Leaving it to her sister instead of a trust for her kids with her sister as the executor/trustee is a bad move if her intent is for it to go to the kids.
I'm sure her children will be provided for via life insurance, as this couple seems to have their affairs in order.
 

LalaSharp

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I was opened before they married. Let's be honest for a minute, some men get an inch and leave. Having money like that is a safety net most women would be lucky to have. What if a man gets physical and you need to run? There's a pool of money you can tap even if there's a penalty to remove it. Better to have the option.

We also don't know the circumstances of the husband's spending habits. Maybe he's the best guy in the world but gambles or makes bad investments. Lot of reasons to have arrangements like this. I just hope the wife has some kind of will or notarized statement.

I had some accounts that I kept separate when I got married. I'm glad I did because I didn't have to split it when I got divorced.
I didn't say the husband should get the money. Certain retirement accounts have beneficiary rules that operate under federal law and the spouse would be entitled to inherit regardless of the designation. The clearest way to address this would have been to have him sign a waiver, and to have a prenuptial agreement to be clear about other premarital assets.

If she doesn't trust her husband and wants her kids to be cared for, she should leave money in a trust for the benefit of her kids and not to another person. Life happens and the money she leaves to her sister could end up comingled with marital funds or as part of the sister's estate if something happens to her.

If she wants to leave money to her sister for her sister's use, life insurance would probably be a better vehicle since it's a straight contract.
 

CharlieGirl17

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When I get married I honestly wouldn't leave anything to a husband. If I had kids I would leave it in their name with my mom to look over it. Overwise I would leave everything to my mom and she will give my husband something if that's what she wants to do. Idk, men are funny with money and I just wouldn't do it..
If you leave the money to your mother when she dies your siblings or mother’s spouse will get the money—-not your children.
 

Sarah330

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If you leave the money to your mother when she dies your siblings or mother’s spouse will get the money—-not your children.
I do not have any children or a husband or any siblings. This literally isn't my issue lol. My mom doesn't have a spouse so either way it would go to my future kids.

However I still wouldn't leave the money to my husband solely.. that's just me.
 

Geekish

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The couple is still in their 30s. I wouldn't feel comfy leaving it to my husband. Especially if I were to die prematurely. It'll be left to my future kids only. Not for my replacement and him to enjoy.
 

Philly4Real

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If I were him I would change all his beneficiaries to his kids or, better yet, into a trust and assign an executor, but I’m a petty b!tch. Her sister instead of the kids? That’s just weird. I get it’s pre-marriage money, which is why if you don’t want to do him, you do the kids. I don’t get it.
I agree why hasn't it been changed to the kids names? Money and death make people do some stupid things unfortunately
 

xdeactivate

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I would do the same thing. A ***** would never ever enjoy the fruits of my labor with his new wife while I’m 6 feet under.
 

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It’s weird that she made the sister the beneficiary. Why get married then?

She needed to make a prenup specifying these things after clearly discussing them with her husband.

The husband has every right to be upset. If she thinks her sister is going to just give her husband/kids the money she’s stupid. If the sister had signed a contract to that effect she should have no problem sharing that info with the husband.

What really should happen is that she makes her kids the beneficiaries. Contingency plans for the kids if something happens to her should be decided with her husband.

Women should definitely keep money to themselves but it’s a retirement account. Spouses are entitled to that. I’m confused.

The fact that she’s not communicating clearly with her husband is an issue.
 

spoiledwater

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Men should never feel entitled to women's money. Period. My beneficiary is also a sibling and will prob remain that way. They are the only person I know who arent pressed about money and would do the right thing.

Anyone else can stay mad.

The fact that this is bothering him so bad just shows how selfish many men are. And the wife was right to not add him.

Whats mine is mine....and whats his is ours......
 
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Before my mom remarried she had me listed as the beneficiary. When she married he tried to get her to put him on the list and X me out. She never did because she made her mind up years ago that everything will be left to me. Who was the most hated by him? Me. Lmao.
After two years of that being an issue with him, he told her he wanted out and she filed for a divorce ASAP
 

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