How to divide duration insurance among 3 beneficiaries...?
My husband has one child from a previous marriage and later me listed as beneficiaries 50/50 on his life insurance.
We have a baby last year and I am confused as to whether it would be better to give notice it as is and add that if I die before my husband the money go to our son, OR should I have my husband divide it equally among the three of us?
My husband says I would call for the money to pay off the house if he died... He said that he does not want his first child to take less to divide it three ways would be ripping his child off.
I am concerned that our child is anyone lost in the process here; it just doesn't nouns right. But I am unfamiliar with how these things work.
I am not trying to shaft his child from his previous marital. I am just trying to look out for our child as well.
Please facilitate. Thanks.
thanks. some men feel that style but mine doesn't. his child resides w his mother but is with us on weekends...
He can list your child as contingent beneficiary to you. That passageway, if you died before him, your child would get your partly. If that sequence of events were to play out while your child is still a minor, the insurance company would require a trustee to be appointed for your child's benefit.
Also, remember that insurance beneficiary designations can always be changed as circumstances require. They are not irrevocable.
Answers: Besides going through the expense of setting up a trust as others have suggest. There are a few things you can do. First determine who you would resembling to take care of your child after name them. Lets say it is Sue.
The primary beneficiary for your enthusiasm insurance should be your husband. Contingent would be Sue FBO (for benefit of) your child.
Your husbands life insurance primary beneficiary should be you per stirpes 50%, his first wife (or garudian) FBO his first child 50%
The way your policy is titled presently if you died before your husband his first child would get adjectives the money. Per Stirpes tells them if you die your portion would be divided equally amoung your living children.
I would suggest these as quick fixes that can be done but you should set up a will and after everything can be spelled out much easier. Some money could be used as support for the children and some could be held intrust until they are old enough to recevie the funds.
Now that he have a second child to provide for your husband shoud consider a seperate term policy just for his first daughter. This policy could expire once she is out of college and frail enough to support herself.
Dividing the insurance 3 ways would be correct he needs to set out support for you and both his children. If he is dividing it 50/50 you and his second child and sharing the same amount that is first child get all to themselves.
Increase the amount of insurance.
A minor shouldn't be the beneficiary of any life span policy. A trust should be set up as beneficiary. There should be a trustee to manage the money as the trust dictates. The trustee could be his ex but the trust will spell out exactly how the money should be used. I've seen too tons ex's spend life insurance money foolishly.
Your child should also have a trust which is contingent to your share.