Dear Ms. MoneyPeace, My wife of 62 years passed away suddenly on March 8th. She handled the financial affairs in our marriage, so I feel confused. Our assets are mostly joint, including cars and our house, which has a large mortgage. Fortunately, we had a will that left everything to me, like our cash accounts and the contents of the house. We have two grown children.
He also had life insurance and a 401 (k) from work. Do I pay the $ 200,000 mortgage with him? I am 60 years old and suffer from Amyotrophic Lateral Sclerosis (ALS) or Lou Gehrig’s disease. So if I want my kids to leave something, I may have to give it to them now. Someone suggested that if they are the secondary beneficiaries, I could say I don’t want the money. Then the children would understand. I can do that? I am working now but I don’t know how much longer. In addition, the last two paychecks arrived from your workplace and the checks were made out to “the property of” rather than just your name. I don’t know how to charge them. Thanks for your help. Crying Widower Dear WW: My condolences on your loss. After the death of a loved one, there are so many decisions and so much paperwork to handle that you can understandably feel overwhelmed. Thinking of your children, even as adults, is a natural response for a widower or widower, but that may not be in your best interest. In fact, you cannot take an inheritance, but it must be done carefully. “A beneficiary … can give up – give up – their property interest,” said probate attorney Ellen Glickman-Simon in Sudbury, Mass. “Certain legal formalities must be followed” to be valid under state and federal law. He added that, in this scenario, “the asset will pass as if the person who resigns died before the deceased.” Procedural rules and deadlines apply, usually nine months after death, although each state is different. Life insurance, retirement investments and joint assets are covered. Because your children are adults, this is the time to think about yourself, your health, and your income needs. Your doctors may not be able to predict your outcome, so don’t make decisions that put you in a bind. On the other hand, if you were to give away the money, essentially, that is what you would do by giving up your inheritance, you can jeopardize your Medicaid benefits. There is a five-year retrospective review in which the government reviews your assets. (The donation of $ 15,000 a year tax-free is included in the Medicaid look-back period.) An elder care attorney can help you understand the finer points of state and federal Medicaid laws. You haven’t arrived yet. Some parents “gift” money to their children with the promise of getting it back later if necessary. But you could open a can of financial worms. Anything in your name is your money. Legally, they can do whatever they want with it. More importantly, your creditors can look for that money. A lawsuit or divorce would put that money at risk. Plus, it could leave your kids with a tax problem. If you gave up the inheritance, your children would have to claim the money within 10 years due to recent changes in the Security Law. As a spousal beneficiary, IRAs and 401 (k) money can be taken during your lifetime. Instead of anticipating what might happen, stay in the present. You must either hire an attorney or go back with the one who wrote the original will. He or she will help you with paperwork and probate court. Make sure they create an estate plan for you now, as your children grow older. The most important are the legal documents for your health care directive and financial power of attorney. The attorney may have suggestions on how to leave money for your children in accordance with state law. He or she may have ideas for a trust that could provide you with income and help your children. When grieving, the best money advice is to wait a year to make important decisions. Do whatever it takes: get new legal documents, file the proper documentation, and take care of yourself and your grief. You don’t have to do everything at once. This includes investment decisions. Keeping cash in the bank is fine for now. Later, decide how to pay off your mortgage. Consider hiring a financial planner for the next financial stages. Paying your mortgage may or may not be the best decision. As for those checks for your wife’s final salary, your employer titled them correctly. A separate checking account must be opened in the name of the “estate in his wife’s name.” That money should be kept separate for probate information. Because she had a valid will, this court process is something her attorney can help with. Finally, in this moment of loss, be open to all the support you need beyond the financial and legal details. Taking care of your mental, emotional and physical health will be the best gift for your children. Many visiting nurse associations and other non-profit organizations offer group talks for grieving spouses, as well as ASL support groups. There are resources online, and you can start with this: a grief counselor who suddenly lost her husband. Create a checklist for handling financial details so you are organized. Taking care of yourself and all these details may be the best way to take care of your adult children right now. Peace to you and your family.