Re: Inheritance and divorce. In community property states, the general rule is that an inheritance is separate property. However, if that inheritance is co-mingled, it becomes community property unless careful records are kept. So if the inheritance is used for a downpayment, for instance, on the marital home and then both spouses income is used to pay the mortgage, taxes, upkeep, etc. for a long period of time, it becomes very difficult to untangle what is separate and what is community.
Just a word of caution. My husband’s aunt recently had her house broken into. Along with all of her jewelry being taken, the binder with all of her financial information was stolen. The binder was for my DH and BIL who will have POA and be the executors of her estate. (Her husband is deceased and there were no children.) All of her information was in that binder. If you are going to keep financial information for your children in a binder, don’t label it as such. Call it “vacation photos” or somthing like that.
Mine is unlabeled. The kids just know it’s blue. But good point.
I might be in the minority, but I’ve shared my (single mom) financial details with my (now adult) D since she was 12 and asked me “Mommy, how much do you make?” When I responded she gasped, “Wow! That’s a lot!” At that moment I broke down all of the current expenses that the “a lot” had to cover (including the taxes that were taken out of each check)…you know, rent, utilities, auto expenses, after school care, summer day camp so I could continue my f/t job, school expenses (mine and hers), medical care, emergency and fun funds, etc., etc., etc… - when I was finished she wondered “How do you do it?” - it was a life lesson and created another opportunity to talk about and put into place a workable budget for her. She is now a financially independent young woman who has a bank account, no credit card debt although she does have student loan debt (heck, who doesn’t…I’m still paying off mine from 15 years ago!), has a travel account which allows her to take a couple of smaller trips a year or one very nice trip, and lives within her means.
Personally I think opening up to her was one of the best parenting things I’ve done.
As @TatinG says, though inherited property is technically that of the heir in a marriage, it’s very difficult not to commingle assets when you are married which then turns it into marital assets.
It’s a very delicate subject and situation when it comes to marriage and assets. For most of us parents, with our baggage of children, marriage, assets etc already in the picture, if any of us were to marry, a prenuptial agreement if sorts is just about de rigueur. For first marriages, early marriages, that’s a whole other story, and yet can be important.
I had mentioned in above posts, that all of us are not fortunate enough to have mature, dependable, trust worthy children. That tempers a lot of what we may want to share with them. Well, when you throw a whole other person into the mix, which is what marriage does, it can complicate the situation even further.
The divorce rate these days is nothing one should ignore and, yes, it is part of one’s financial planning picture. I’ve sadly seen some very short lived marriages, that resulted in a huge loss of money. When you start commingling assets with your children, giving them things, when they marry, there is another person in the financial picture.
Someone I know liked helping her kids out in buying them their first houses upon marriage. Worked fine for her twins. Then her daughter had a very nasty divorce after a very short lived marriage. The equity in that house was half the spouse’s. Yes, you can set things up so that doesn’t become the case butyou have to know what to do and do it.
I watch way too many true crime stories on TV to ever divulge my actual worth to anyone, especially an heir or a beneficiary. My kids know, in general terms, that we own 3, eventually to be 4, houses, 2 with mortgages on them, that I have a 401 (k), a rollover IRA and 2 inchoate pensions and that H has a SEP. They don’t know how much is in any of the accounts.
I have named 2 of my kids as co-executors. D, who is the glue that holds her 4 brothers together, and middle son, who is totally disinterested in money, but is honest as the day is long and the best math mind in the bunch, will share the duties. I pay most of my bills online, but refuse to go paperless. This way, if something happens to me, bills will come in and they will be able to figure out what I owe. They know where I bank. I did tell D that I have one hidden online bank account, linked to a credit card.
I do plan, when I retire, to divulge a bit more about our finances to D and possibly one of the boys.
^^ HA! That’s JUST what I’ve been thinking!
I was watching an episode of “Snapped” on the Oxygen channel (guilty pleasure!) where a son killed his parents for the inheritance. It wasn’t the first such episode I’ve seen.
Not that I think DD is a murderer, but DH did comment that “maybe being honest about our finances wasn’t such a good idea…”
It doesn’t have to be your kid that decides life would be cushier if you were gone. There are cases where friends of a kid, or relatives of a kid’s SO feels the wealth could be better shared if your money were in your kids’ hands rather than yours.
I lived i. A high rise apt building once where a rash of burglaries were happening. The common link was s much trusted long term cleaning woman. Some investigation revealed that her nephew or other ne’er do well relative stole her key ring, had duplicates made and they would pump the older woman for info about “her families” particularly about vacations and trips they might be taking and their schedules. Armed with the info and keys, they’d hit up the apartments.
“Loose lips sink ships”, so a lot of ways one can endanger selves by telling kids or others too much info.
A distant relative was rather well off and trusted just one son to take care of her finances. Instead, he stole a lot of her money. Her other children didn’t find out until a lot of the money was gone. If all her children had been monitoring the finances, this could have been nipped in the bud as soon as unusual withdrawals were noted.
My husband is so paranoid that the user names are in a folder labeled “Documents” but the passwords are in a secret place that only the family knows about - and not a place your average thief would know exists.
Its a tricky situation for some. Momx told me of an article or somesuch that she read that noted the following no-win reality: if, when you finally die, your estate is bigger than the kids had guessed, they resent the fact that you didn’t share more of it with them sooner when it would have done “more good”. And if your estate is smaller than they expected, they spend time complaining that you must have been unnecessarily profligate in your spending.
You do have the problem that if you’re decently well off or better, letting them know invites input from them and fuels opinions about what should be done with your assets, and when. And in my own generation, I’ve seen examples of daughters-in-law and sons-in-law whose views about what the spouse’s parents ought to be doing are surprisingly self-interested.
My own approach is to generally be silent about our situation, and encourage them to live within their own means. We’ll help out here and there on an isolated basis, but the information about what is “available” to us is not their concern, and not their spouse’s either. So far that doesn’t seem to be a problem for them.
I agree that it’s best to have children make their own way in supporting themselves with parental financial assistance given as the parents feel is what they want to give. As ever, this is just s very general statement There are numerous exceptions. The extremely well to do and the financially challenged have issues most of us on the middle do not. If there are family businesses, illnesses, special circumstances, it is sometimes important for children to become actively involved.
My Friend has an adult child with autism who is not self sufficient. Siblings are likely to be taking care , both financial and personal of this situation. When my friend’s father was treated for a heart condition, these parents felt it was necessary to get the information on the table in terms of “passing this baton”.
Another friend has his children actively working in the family business.
It varies greatly
Yeah, I didn’t walk too close to the edge of the cliff when with my kids. They did know I had life insurance and that they’d be financially better off with me dead. Ha, I survived.
Yeah, but in either case, you’re dead, so you don’t care.
There seems to be an unstated assumption that, as soon as the funeral is over, the potential heirs show their worst sides fighting over the estate, if there is any.
What ever happened to the idea that, if the adult child and his/her parents are financially self sufficient, with neither being a financial burden on the other, the adult child need not care about any inheritance? Or is it that such a large percentage of middle aged adults are financially stressed, so that even those who are middle or upper middle class feel that they “need” as much of the inheritance that they can get to relieve some of the financial stress?
I bet this causes as many problems as it solves. Having heirs throw out the “vacation photos” binder without looking inside is going to be at least as common as ever having the binder stolen.
When my parents became elderly and somewhat infirm, my sister and I began to pay their bills and do their financials… Thus, we knew how much they had. OTOH, my father-in-law told us nothing and did not let anyone help even when he was over 90. We knew of the house he had, but otherwise no idea about any accounts. I think some of dh’s siblings felt like he should have helped them and their kids out more since he had more resources than he seemed to. To me, it was his money and his decision as to how to spend it.
At this point, my kids don’t know all much about our financial situation but as we age and they become more self sufficient, we will share more information with them. They know we plan to not need financial help, but may someday want some physical help (my f-i-l lived far from all of his children which made his last years lonely even though he was in a community, still would have wanted more visits). The amount of money that may be left often depends more on end of life care costs than on how many vacations the parents go on.
Outside physical or mental issues that preclude living as an independent adult, I don’t think it’s reasonable for adult children to expect their parents to “help them out more” simply because they have the resources to do so. Just because you can doesn’t mean you should. I agree wholeheartedly with that last quoted sentence, though things can certainly get ugly when there is perceived unfairness (real or imaginary) among family members.
What I don’t agree with, which could be an entirely different thread, is a spouse not having any idea about accounts and resources. When fil passed, mil had NO idea what accounts he had other than their one joint checking account. No idea where to look, etc. I also don’t think mil had any idea about the total amount of money they had. Fil was as cheap as they come and nagged at her about spending money. I think there was some resentment on her part that she had spent many of their married years defending purchases she made while he was living once she realized what they had AFTER he died. And, she worked more years and had earned more money over her working career than he did given that her SS payment was somewhat higher than his. Patriarchy at its finest.
EDIT: Not that they were super wealthy, but they could have enjoyed what they had a lot more.
I never ever expected my parents to help us out and was surprised when they offered at various points. (When we bought our first house for example.) My older younger brother, I know got a second mortgage from my Mom when he got caught in the dot com bust - I know exactly how much he borrowed because it came out of his share of the estate. 
My kids don’t seem to expect to get money from us, but I imagine if our younger son wanted to buy a house we might gift him some money then. (Our older son has more money than he knows what to do with and is unlikely to ever bother to buy a house.) I don’t think there’s any right answer here. I think it depends on what your kids are like and how you think they might react to good or bad news.
Given the cost of end of life care - I can understand parents being reluctant to give away too much money before they die. OTOH there’s also this point of view https://www.amazon.com/Die-Broke-Radical-Four-Part-Financial/dp/0887309429 . I remember my father read this and was quite influenced by it.
@Hoggirl , I get it. I’m still trying to posthumously forgive FIL for some of the things he could have spent money on but wouldn’t. MIL wanted to go on a couple of trips that got slow-rolled until they were too old, mostly because FIL couldn’t figure out how to do it on the cheap. And FIL refused to pay for care for MIL while she was in hospice for over a year, sticking to only the few hours Medicare would provide under hospice, even though she needed more care than that. By that point we had an idea about how much they had and kept hounding him to spend it, but having it meant more to him than using it. AARRRGHHH!. So the forgiveness is still a work in progress.
MIL had some idea of the money available, but didn’t get much of a vote in spending it. DH and his sibs knew only toward the end how much they had.
We’ll join the crowd that says help the kids if/when we can, but we will not jeopardize our ability to pay for expensive care at the end. Whenever that is.