Money disputes are one of the most rancorous topics for estranged couples and are often a primary reason for divorce. Things inevitably get worse when in-laws and extended family get involved to make it a de facto matrimonial gang war. A sudden windfall unfortunately can bring out the worst in people when a couple’s relationship is already on the rocks.

A Real-Life Microcosm Game of Thrones?

Echoing how the death of Robert Baratheon in Game of Thrones sets off siblings, in-laws, and outsiders all scheming and murdering to seize the Iron Throne of power, a windfall inheritance can suddenly become the prize that unethical in-laws and extended family may battle over. 

A Reddit poster expressed personal concerns over this exact scenario. Recently the heir to a sizable fortune, the poster is afraid that his wife’s family will convince her to sue for divorce in order to take control of the inheritance. He requests guidance as to how to deal with this but discloses few other details.  Some of the questions that come to mind that would help to flesh out the situation might be:

• Since news about receiving an inheritance is usually a cause for celebration, have you and your wife been having problems for a while that cause you to feel a divorce is in the works, and if so, please elaborate.
• Have you had past conflicts with your in-laws that give you cause for suspicion that they will influence your wife to leave you?
• Do your in-laws have a history of financial problems or a criminal history?
• Did the inheritance include compliance specifics as to qualifiers listed in the will before the inheritance assets can be claimed? For example, did the testator make conditions, like “must lose 25 lbs.” or “must return to and finish college to graduate”, or “must marry someone in our family’s religion” that the executor must check off a list before allowing a transfer to you? One could see the last item as a potential divorce trigger.
• Has the poster himself already been unfaithful and is concerned that the wife has legitimate grounds to divorce and take up to half of the marital assets (assuming no pre-nuptial agreement and in a community property state)?
• Is the wife an immigrant who sees the inheritance as the golden ticket for the rest of her family’s benefit rather than for you and her? That might be cause to re-examine the marriage and the priorities in the relationship, which may not be shared values and goals.

Proactive Defense

Assuming the worst-case scenario, i.e., that the marriage is about to sail off a cliff and crash, the poster needs to take certain proactive measures if he wants to keep the inheritance, or at least a substantial chunk of it – out of his wife’s and in-laws’ hands. Both divorce and tax attorneys should be consulted for more professional advice, but below are some facts upon which to formulate a strategy and initiate first tactical moves.

Most states consider an inheritance from a relative or other party to not be community property – unless it gets put into a joint account where both spouses have access to it and have used it. Therefore, the poster should protect himself by:

• If he has not received the inheritance assets yet, he should set up different accounts and title entities solely under his own control so that none of the assets can be claimed as community property.
• No jointly held funds should be used to maintain or pay for any expenses associated with the inherited assets, otherwise the wife would have a claim for community property rights.
• Perhaps have a private discussion with the executor to set up investments with the assets that limit the immediate liquidity, and access within your own name, trust or other new entity.

A sudden windfall can make one a target for all types of grifters, 2-faced “friends” and leeching relatives for a handout. Saying “no” can be difficult, and can cause much personal strife among both family and friends, if not handled in an organized and diplomatic fashion. This is why many pro athletes and lottery winners wind up going broke after the gravy train has left – they did not plan in advance and couldn’t say “no”. 

If the wife’s priority is not placing your marriage and immediate family first, then the above steps are even more crucial.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.