Dear Quentin,
I am 85 years old with an estate valued at around $4 million, which includes my home. Although I have long-term-care insurance, $500 per day may not suffice for round-the-clock care in today’s environment. Nearly half of my assets are subject to taxation within retirement accounts, while the remaining portion is held in stocks and money market funds. My residence is placed in a revocable living trust.
In 1979, I went through a divorce following a 16-year marriage to a physician who lacked long-term-care insurance and incurred significant expenses during his final months. Following the separation, I found myself with only $15,000 saved up and two young children—ages five and nine—to provide for on a limited income. Remarkably, much of my current wealth has been accumulated independently as a financial advisor, along with a modest inheritance.
My former husband bequeathed just under $2 million, which was divided among my two kids, though the terms weren’t fair.
Here’s the issue: My former husband passed away leaving just under $2 million, which was divided among our two kids, but the terms weren’t fair. Our daughter, an architect who’s 53 years old, isn’t married and has been cohabiting with a partner for many years without having any children. Meanwhile, our son works as a certified public accountant, is married with two kids, and his spouse is also a CPA. He had complete access to the funds and even took two years off from work during the pandemic to look after their children.
My daughter suffers from serious medical conditions—specifically, lymphoma, which is currently under control. Her financial assets are restricted, requiring her to seek approval from a trustee just to be compensated for medical costs. The funds aren’t easily accessible for personal use. Both she and her partner, who is also an architect, wished to purchase property, but this isn’t possible due to these restrictions. Any remaining portion of her father’s estate following her passing will go to our grandchildren.
My daughter, quite reasonably, feels resentful about this scenario and would prefer me to allocate a bigger portion of my assets to her so she can have additional available funds, similar to her brother. I’ve discussed this with my son, and he believes the estate should be divided equally—half for each child. There was significant tension between my daughter and my son following the passing of my former husband.
What should I do?
The Mother
Related:
At age 63, I’m considering retirement. I was terrified when the market crashed. Do you think I’ll have sufficient funds to last until I reach 90?
Dear Mother,
Here are some choices for you to consider. Please bear with me as I present them.
You might refuse your daughter’s request and divide your assets equally between your children once you pass away. Alternatively, you could provide both your son and daughter with their share of the inheritance ahead of time, reserving around $1 million for yourself. Another option would be to give your daughter all or part of her inheritance before you die.
I advise against not having most of your assets available. Extended healthcare costs can add up significantly, and even though you’ll have enough to support yourself, I think it’s unwise to end up with just a small sum during your final years.
A legacy—as the term implies—is only real when you choose to pass it on. Nobody, not even your offspring, has a right to inherit from your wealth unless you decide to include them. This is why many dog and cat shelters are so contented.
Another unresolved query remains: Why did your former husband place your daughter’s inheritance into a trust? If she previously squandered funds, this is a concern that shouldn’t be overlooked now. However, if that isn’t the case, was there a preference for his son due to his sex?
Perhaps your daughter has a different motivation for seeking an earlier payout.
Or was there another aspect tied to the parent-child dynamic? For instance, did he dislike and/or have difficulties with your daughter’s boyfriend? Inheritance distributions can sometimes reflect personal biases, yet you now have the chance to consider your children’s present circumstances alongside previous gifts.
Because of your daughter’s medical condition and the unfair manner in which her father divided his assets between her and her sibling, I don’t see any justification (other than what was mentioned earlier) for not reaching an agreement and providing her with part of her anticipated share before you pass away.
You are not required to disclose your estate plan to your son. It’s possible you may choose to leave a bigger portion of your assets to your daughter when the time arrives, but I think parents shouldn’t decide such matters based on demands from their children.
Alternative small legacy presents are available as well. “Lifetime giving enables contributors to pass assets to recipients, with limited tax impact,”
J.P. Morgan Private Bank
states, “It also reduces the donor’s taxable estate by excluding potential future growth from estate tax calculations down the line.”
A lingering mystery: Why did your former husband place your daughter’s inheritance into a trust?
According to IRS guidelines, the total exemption for estate and gift taxes over a person’s lifetime is now $13.99 million (with double that amount, $27.98 million, available for couples who are married). You have the ability to transfer up to $19,000 annually per child each year (and $38,000 for married couples) without needing to report this as part of your yearly income tax filing.
High-net-worth families must take additional steps when planning. If Congress does not intervene, the maximum amount one person can gift without paying taxes will decrease in 2026 to $7.2 million. The gift tax, which is paid by the giver, covers assets transferred during a person’s life, whereas the inheritance tax is applied to property left behind after someone passes away.
However, your main concern should be ensuring a peaceful retirement without worrying about extended care expenses. Remember, a private suite at an upscale assisted living facility might set you back nearly $10,000 each month. Make sure your children aren’t the ones deciding this for you.
Related:
After 21 years of marriage, my wife has requested a divorce. She plans to use our shared savings to purchase a home but assures me she will assist with paying my mortgage.
You may send your financial and ethical inquiries to The Moneyist via email at qfottrell@, and connect with Quentin Fottrell on X, which was previously called Twitter.
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The Moneyist apologizes for not being able to respond to each query personally.
Earlier articles by Quentin Fottrell:
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“I’m confused”: My partner, with whom I’ve been together for almost 10 years, is designating his older parents as beneficiaries and granting them legal authority. Is it reasonable for me to feel hurt?
“We don’t have a prenup”: Will my spouse be entitled to my funds if I move them into my retirement account?
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