My mother in law wants to set up accounts for my three children, leave her 401k to them, and put them on her life insurance. We have an estranged relationship with her and I don't feel comfortable giving her the info since it is so personal. Can't she leave the money to them in a will and after she dies they can provide this sensitive information to whatever company needs it? She already has their birthdays and address and I think the social security numbers are something she doesn't need since we don't know how many people will have access to the information and I have no idea what kind of accounts she would like to set up.
These kinds of assets are normally handled through beneficiary designations. That way you eliminate the need for probate. Accordingly, you also bypass the provisions of a Will. It is FAR less expensive and complicated to handle it this way. Of course, if the kids are minors when they inherit the funds, some form of probate might be necessary, anyway. But most people prefer to avoid probate. I would give her the information. Otherwise, she may choose to leave the money to other beneficiaries.
James Frederick
Scott Eugene MoseleyProbate AttorneyFort Worth, TX ·
To answer your core question, can she leave your children these assets through a Will, the answer is yes. However, the choice of what devices she uses to effect her estate planning is entirely up to her. It is entirely possible that the management company for her 401k requires Social Security Numbers for beneficiaries.
It sounds like your mother in law should be sitting down with an attorney. Numerous factors need to be considered, including the value of each asset, the amount going to each child, the expected age of your children when she passes away, and others. It could be that using such methods as you have described can have a far greater financial consequence than utilization of a simple Will and the Probate process.
Eric Jerome GoldTrusts AttorneyCalabasas, CACA licensed ·
My colleagues are correct. There are distinct advantages to your mother-in-law leaving liquid assets to your children in a manner that passes outside of most probate concerns. Many finance companies may simply require the SS #s to setup the accounts. If you are still concerned, perhaps your mother-in-law could have her estate planning attorney explain the need for the SS #s. Would that ease your concerns?
