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BM being beneficiary to stock.

Stepmom25's picture

So DH has BM listed as beneficiary for his stock prior to our marriage. He says it’s for the kids because she has them 90% of the time. Should I be understanding about that? She hasn't given us any problems. I am beneficiary to the house and his life insurance.


GrudgingSM's picture

Feelings are feelings, and you can feel however you want about it. I know my DH gets next to nothing from me if I die young because my assets and life insurance will go In a trust for my kid. So not to my ex, but not to DH either. For me, with younger kids, I feel it's important to leave enough behind for them to be supported. It's even in DH's divorce decree that he has to leave a Life insurance policy in BM's name. So I don't think it's unusual, but you're also totally entitled to not feel great about it.

Maxwell09's picture

I think it should be in his kids names and if they are underage have it set up so that it will be given to them when they come of age. He needs to keep in mind that if something happens to him before they age out, she will recieve social security benefits and other payouts. 

If I were you I wouldn't make it about you vs her; I would put logic out there and say that if its for the kids then there are better ways to make sure it goes to them. If he puts up a big fuss and makes it about taking care of BM for being the "mother of his children" then he has other issues yall need to address. 

ndc's picture

To me it would depend on how much the stock is as a percentage of his total assets, and the relationship with BM.  If it's a reasonable amount and BM is a reasonable person and would use the proceeds of the stock for the kids and it was clear that this was in lieu of coming after the estate for any other form of child support, I'd be OK with it.  If the stock is a large part of his estate or the BM is a problematic individual, I would want him to put a portion of the stock into a trust for the benefit of the children with a trusted relative as the trustee, or something like that.  Also, I trust he revisits things like this and his estate plan occasionally, and it will change when the kids get older.

Wilhelm's picture

Here child support ceases immediately on the demise of a parent. I can see he wants to make sure his kids are cared for. Anything I had before marriage is mine and anything my husband had before marriage is his.

I do not intend to leave DH anything that skids could end up with.

Peach's picture

I would rather leave it directly to the kids or a trust for them - not BM.  Additionally, I think it also matters as to how much a percentage of the estate it is.   It is better to leave it to the people that it is intended for.  

notarelative's picture

It's not unusual in second marriages to keep property acquired before marriage separate. So since he owned this before marriage, I can understand it being separate. (And if you have before marriage items, he should have no problem with you keeping them separate.)

But, if it's for his kids, he really should consider putting it in trust. If he dies while they are under 18, there will be social security money for the kids until they turn 18 to replace child support. The trust would insure that the money is available for college or trade school. 

tog redux's picture

I know some people feel it's fine if they give everything to their kids and leave their spouse high and dry, but that would not fly with me. If he was married long-term to BM, ie 25 years +, then yes, the kids should inherit what he and BM worked for together. But if it was a short marriage (I assume so, since the kids are still with BM), then he should be planning to help you in your retirement (and you him) rather than giving it all to the kids.

Now, if he has other assets and investments he plans to leave to you, then fine to put some in trust for the kids. Or even take out life insurance that pays out to BM until they are minors and then to them as adults. Or if you are financially set.  Otherwise I would not be okay with him helping out the kids over me after his death.

lieutenant_dad's picture

What is his long-term plan with those funds, and what is the intention of those funds?

Some COs require the CS-paying parent to have a life insurance policy or other assets set aside in the event they were to die while the kids were still minors. Even without a CO, it's not a bad idea to have assets set aside to care for minor children. It's also not a bad idea to have some assets set aside for kids to inherit as part of their parent's estate should they die before the SP.

My DH doesn't have a specific fund for the boys, but I know how much I'd give ET for YSS's care based on what she'd receive in CS, and how much each SS would get in a trust based on what DH planned for them for college. That amount will shift and change as they age, DH's assets change, the economy changes, etc. The last thing I want if DH dies young is to have to fight ET in court over money. I also don't want his sons to not inherit some of their father's hard work since much of his hard work has been to support his kids.

I also agree with the sentiment that money earned before the marriage is not up for grabs by the "new" spouse, especially when children are involved. Assets acquired after the marriage need to be discussed and decided by the "new" couple. 

In this situation, OP, I don't think you have a right to dictate how he spends that he acquired prior to marrying you, just like he doesn't have any right to money, property, investments, or inheritance you brought into the marriage. However, if he continues to add money to that fund by buying more stocks with no intention of transferring those funds to his kids (at least "new money" as he may have a CO that requires him to pay out a certain amount to BM no matter what) while short-changing you and/your mutual future (e.g. he buys more stocks for them while putting in less money to his retirement for you both), then you have a very big problem. Money that predates your marriage is his to do with as he sees fit. Money earned within your marriage, though, needs to be discussed how it's spent and how it contributes to mutual goals. 

tog redux's picture

I'm glad my DH doesn't feel this way. Money we both had before marriage (and the split of BM's 401K) will go to support both of us. If anything is left, maybe SS will get some. But to me, second or third marriages shouldn't necessarily be different than first ones - the partners take care of each other before the kids get anything. 

lieutenant_dad's picture

I'm not saying don't take care of each other, or that you absolutely HAVE to leave something. But as a second spouse, you don't get to dictate what happens to money you didn't help generate. Everyone deserves safety net money, and that's a perfect pot of money to pull from - assets prior to marriage.

If OP and her DH are on the verge of losing their home or can't pay their bills and he needs to decide between cashing out stocks and pulling from his 401(k), then he needs to cash out the stocks unless he's bound by a CO to keep them. But OP having negative feelings about stocks being set aside for his minor children isn't enough to justify him changing his arrangement. Same would be if OP had $20,000 set aside prior to marriage that she doesn't need now that she wants to donate to charity upon her death. They are HER assets and SHE gets to choose how and where they are spent.

It seems odd to me, as a community, that we generally tout that SPs should have their own safety net money should they need to leave, or they should keep their finances separate from their partner. Yet, when the partner does something similar, it's a bad move on their part. We can't have it both ways where we say "your spouse is responsible for their own kids!" and then when they are come back and say "how dare they keep funds set aside for their kids!"

tog redux's picture

This isn't a "safety net", I have zero issue with that. DH and I have joint accounts and our own separate ones.  If I die, mine goes to him, and his goes to me. Not to SS.

If this guy dies, his "safety net" goes to BM, not his kids. And not his partner.  They are absolutely responsible for their minor children and many places will insist on life insurance or, in my state, the custodial parent gets first dibs if he/she sues the estate for remaining child support.  That's what I said above. But I bet this "safety net" will be left to his kids regardless, whether or not that leaves his partner eating cat food in retirement. And I bet if they need it for other things while alive, he won't touch it.

To me, it's just another manifestation of people not putting partners first. In first marriages, partners are first. I've never heard of anyone bypassing their spouse to leave everything to the kids in a first marriage, and in fact, many places prohibit that. But somehow in a second marriage, that's just fine to do.

And no, she can't control what he does. But it speaks volumes about his priorities, if he leaves it there once the kids turn 18 or whenever he no longer owes child support.

lieutenant_dad's picture

OP's DH is leaving her the house and life insurance policy. She's not being left high and dry. She'll also be entitled to his retirement account (can't change the beneficiary without your spouse's approval) and bank accounts. 

This is ONE asset she doesn't get because it is set aside for his kids. Yes, it would be better if he set it up to go to a trust versus BM, but aside from the practical matter in that, her DH is entitled to set aside his money for his kids. Many parents do.

tog redux's picture

He's entitled to a lot of things. Doesn't mean she can't be unhappy with it. I wouldn't be happy with BM being the beneficiary for anything.

I'm just grateful DH doesn't think his kid is more important than our life together.

SD.stepmom's picture

The OP states in her post that she is the beneficiary of her DH's life insurance and will also be getting their house so she's not being left to "eat catfood" at all.

Her husband has a responsiblity to make sure his minor children are provided for as well. 

As others had stated, it might make more sense to set up a trust in this type of situation, but it depends on how responsible the BM is as well.

Funds are generally not left to children in first marriages normally because the assumption is that at the remaining spouse will take care of their biological children with some of the inheritance-not because of some bias against future partners.

HowLongIsForever's picture

The OP states in her post that she is the beneficiary of her DH's life insurance and will also be getting their house so she's not being left to "eat catfood" at all.

This rubs me wrong.  I'm not even sure I can properly or appropriately articulate it.

She'll also be getting THEIR house.  Well f'ing-a what a lucky gal.  Her husband, life partner, has been so kind as to allow her to be first in line to THEIR house.  

Hopefully DHs existence isn't (or doesn't become) under insured since her value in and contributions to their partnership literally barely equate to his share of equity in THEIR house.

Totally separate from ensuring financial support is available to minor children left behind.  I don't think anybody is debating that. 

To imply she should be grateful to receive rights to a joint asset feels a bit dickish, though.





tog redux's picture

Exactly, thank you. For all we know, the house is worth 100K, the life insurance the same,  and the stocks 1M.

The couple should come first and the kids get what's left. Minor kids need support, but it doesn't have to be stock. It can be a provision in the will that the remaining CS to be paid comes out of the estate and the rest goes to his spouse to live on.

There are plenty on here who don't even want their spouse to get the house. This guy is halfway there, but not entirely.

tog redux's picture

The children left behind have a parent. And you can arrange for the remaining CS to be paid without leaving BM a bunch of stock that might be of much more value than what he owes in CS. And does he plan to change the beneficiary when they turn 18?

I think it has more to do with not valuing second/third spouses the way they should be, for this type of man. Kids come first.

skell76's picture

that would be a hard no. I am thankful DH does not want BM any part of our lives and understands there was absolutely no way I would have her in anything of ours.  We are eachother's beneficiary's with outlined trust information for our children.  

Tried out's picture

leave it to his children with an executor to guard it until they are of a certain age, with very clear instructions regarding how it can be used, if at all, until they are adults. It's insane to leave it to the BM with no strings attached.