Once a Deadbeat, Always?

Deadbeat dad

Here’s another deadbeat dad story — but with an unusual twist.

(Yes, I know plenty of deadbeat mothers exist. Here’s a tragic example. But “Gold Diggers and Deadbeat Non-Custodial Parents” isn’t catchy.)

If you read my book Gold Diggers and Deadbeat Dads: True Stories of Friends, Family, and Financial Ruin, you might remember Diana’s story, “Where Did All the Child Support Money Go?”

Diana’s troubles began when she married her high school sweetheart Bart, who turned out to be anything but sweet, she told me.

Instead, he was a raging alcoholic who slept around their small town in a Minneapolis suburb.

[Read more…]

Would You Loan Your Family Money, Even If You Knew They Lied?

 

Lying woman wants to borrow money

The following blog post is part of the The Road to Financial Wellness  Blog Tour. Over a period of 30 days, the Phroogal team will go to 30 locations to raise awareness about financial empowerment. On June 6 they will be in the Washington D.C. area! Our goal is to help people learn about money by starting the conversation. We understand that local conversations can help bring about national awareness.

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I met William when he was doing plumbing repairs at my home. I’ve got an old house, so plumbing issues crop up periodically. We started talking and he told me about his dysfunctional childhood.

(It always amazes me when people tell me such intimate details about their lives, and not just about money.)

[Read more…]

Your Long-Lost Rich Aunt Dies. You Inherit a Fortune. Now What?

 

inheritance

Have you ever dreamed that a wealthy relative died and left you a fortune? Nice fantasy, right?

It happened to David, an accountant who lives in Dayton, Ohio. He got a call from a lawyer in Cleveland. It seems that David’s late mother had a half sister named Lucy. David knew Lucy only vaguely; no one ever told him the family backstory, but bad blood flowed between Aunt Lucy and David’s mother.

Lucy had one son (David’s cousin) who dutifully set up a trust for the benefit of his mother. Unfortunately, her son never got around to changing the beneficiary in case he died before his mother.

Which he did.

Who gets the inheritance?

When Lucy died, she had no other children, grandchildren, or siblings, so next in line to inherit were David and his younger brother. They were stunned to find out they were entitled to a windfall of “a considerable amount of money,” the lawyer said.

Six figures. Hundreds of thousands of dollars.

Aunt Lucy must be rolling in her grave.

What to do with all that money?

I asked David what he planned to do with the money. New house? Car? Trip around the world?

No, David’s an accountant, and fortunately he’s too practical to blow his fortune. When he gets the money in a few months (assuming there’s no challenge by an even more distant relative), he plans to stash it away and wait a year to figure it out rather than spending it all on luxuries. He’ll probably put it towards college costs for his young kids. Quite reasonable.

Lesson: Update Your Beneficiary

Think of a relative who’s not exactly your favorite person. Now, imagine you worked hard and did quite well financially during your lifetime. You die and that person gets all your money and possessions. Can you see the look of glee on their face? They’re not going to turn it down, even if you disliked each other, right?

Lesson? Keep your will, trust, and other estate documents up to date. Name a contingent beneficiary for your life insurance policy and IRA and 401(k) accounts. Play out all the scenarios of what will happen if people don’t die in the “logical” order of oldest first.

Don’t inadvertently give yourself a reason to pirouette in your mausoleum.

Are your beneficiaries up to date?

What would you do if you inherited a fortune?

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Related posts:

When You Die, You’re No Longer a Person
You’re in a Coma: What are the Financial Consequences?

Wife Insurance
Too Much Power in Your Power of Attorney?
Update – Powerful Power of Attorney
Why I Refuse to be Co-executor of Your Will
The Gold Digger Who Would Murder for Money

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