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Supporting In-Laws Soon?
My Father-In-Law is getting older and he recently came to DH and I to talk to us about his will. He asked us to be in control of his entire estate regardless of if DH's mother outlives him or not. He has worked hard his entire life and has saved most of his income throughout the years. Recently, my two sister-in-laws have made some bad life choices (one is 31 and one is 23), they have both left their husbands and even though they have paying jobs are mooching off of my in-laws for EVERYTHING! My father-in-law does not want to help them because instead of paying their bills they go out and spend on it frivolous items. It is my mother-in-law who is sending them the money not realizing that they are just using it for luxury items or partying in the case of the 23 year old with kids.
The point is: my father-in-law wants us to control the estate and put DH's mom on a sort of allowance after he is gone so that she does not blow through all of the money that he has saved over the years. Furthermore, he told us that it would be left up to us to make sure his two sisters are taken care of because they would not be able to do it on their own without getting into financial trouble. He may make DH a trust owner of all threes inheritance of sorts I suppose and expects us to support the two sisters since he would not be there.
I should mention that we are still young graduate students ourselves. We are financially stable enough to take care of only the two of us.
I am not sure how to proceed. I don't mind DH being a trustee of sorts but I don't see why it is our responsibility to take care of two immature adults. I think we would both flat out say no if either sister did not have children! I
I was also wondering especially for my younger sister-in-law if there is a polite way to tell her that she is using her parents and that it is not right to ask them for money to pay her bills when she goes out weekly with friends, buying clothes every single week, and buys other frivolous things on her credit cards and then just thinks well mom and dad will give me the money for it so I don't have to worry about it?
Between her divorce and other things they have spent nearly 8 thousand on her in the past six months alone.
Re: Supporting In-Laws Soon?
Does he want you guys to give them money if they need it after he is gone? You and your H are in no way obligated to financially take care of you SILs and their kids. While it sucks for the kids that they have irresponsible parents, you and your H can't support them so don't feel guilt about it. They are adults, they shouldn't need someone to watch over them that is ridiculous.
If your H wants to be the trustee of his father's estate and the money you are giving them is coming from the trust and not your own pocket, it just depends on if you and your husband want that kind of involvement in your ILs lives.
And you probably shouldn't say anything about the SILs mooching off of your FIL. It sucks, but it's their call if they want to give her money. If something is going to be said, your husband should say it but I doubt it will make a difference.
You need to speak with a lawyer about this. Make an appointment for a consultation with an estate attorney, and make sure that DH and FIL attend.
If FIL and MIL are married, there may not be anything you can do to stop her from inheriting her late husband's money/assets. Just to warn you, marriage is pretty binding most of the time. If FIL doesn't want MIL to inherit his assets, they may have to divorce on paper before his death in order to make your DH primary beneficiary.
I'm not an attorney though so go make an appointment with someone who is.
Has your FIL spoken to a lawyer and financial planner? I would want to sit down with his lawyer and discuss just exactly what he expects of your DH. Perhaps, the lawyer could handle the estate and be the 'bad guy' for your FIL. You are going to have a difficult relationship after he is gone if you are the ones putting 3 grown women on an allowance. Your MIL is just as ignorant about finances as the daughters. Why on earth has someone not asked if she realizes they are partying away her security?
One positive thing is if they were to get ALL their inheritance at once and pissed it away then I could see them begging you for help. At least with control of the money you would make it last longer and them not being turned down by you when they came crawling. Too bad he cannot put a caveat in the trust they are not to get anything until they are 60.
Your FIL is asking you and your dh to do something he is incapable of doing himself: control his wife and daughters' spending. If your dh agrees, he will be placing himself and you in a position of constant conflict with your MIL and SILs. I'd advise your FIL to go to a bank, with a wealth management department, and set up trusts with the bank as trustee, so that in order to get the money your MIL and SILs have to demonstrate to the trustees that they should have the money, under the terms of the trust itself. It'll save you all a world of heartache.
So, your FIL wants to cut his wife out of all of her assests upon his death and put his youngest child (and only son apparently) in charge of giving her an allowance. An allowance that will allow her to live but also allow her assests/savings to support her two grown, employed children (but not too much). And his son is to make all of these decsions - appraently in a harmonous way that won't outrage all parties involved.
Nice.
The first part is illegal and the second part is irrational. Your FIL has to do the hard work or straightening out all three of them now, rather than hope you do it after he's dead. He's not just treating his adult children as children, he's treating his wife as a child, too.
Your FIL REALLY needs to plan this well with both a lawyer and a financial professional.
Yes, it is possible to set up a trust so that your MIL can have access to the interest on the estate but not the principal (at least it is in my state). My FIL set up a plan like this for part of his estate b/c his wife is a gambler. The way it worked, MIL could access the interest (an "allowence") and could only get the principal for medical reasons, etc. When MIL passed, all of FILs kids would split the money.
However, it DID cause a LOT of friction in the family. The whole family knew about it, and dh's sister stopped talking to him b/c she was angry/jealous he was the trustee (dh = oldest son, smartest, and most trustworthy of all of the siblings). His sister thought that if her mom got the principal, she would get everything (her mom is not dh's mom, and favors SIL). This was 10 years ago, and FIL was (and still is) very much alive!
It might be in the family's best interest for your dad to set up the fund, have your H oversee it, but have a financial representitve or lawyer act as trustee. I would also add that being trustee can be a lot of work, and unless your H was getting paid for this work, it might be a lot of hassle.
PS: Don't butt in and tell your SIL how to live her life or if what she is going is fair to your ILS. That's none of your business, and if your ILS had a problem with it, they would cut her off. THEY have the choice. Obviously, your ILS are not on the same page, but that is not your problem or your business, and as an in-law you are better off keeping your mouth shut.
Sounds like it's better for a neutral third party to be in charge of the money. If you and your H wind up being responsible for how much money MIL and the sisters may/may not receive, they're going to guilt and emotionally manipulate you guys into giving them more.
I would tell FIL that you would be happy to help him find a good lawyer or financial professional to help him sort all this out.
Tell him that you are not comfortable doing this. There are several options for trust funds and annuities that he can set up to take care of his family before he dies. Being in charge of the family money will only cause issues and stress.
This. Your FIL is putting you and your DH in a no-win situation here. There is no way I would agree to this, it is guaranteed to breed resentment and family estrangement.