does beneficiary trump all

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Calhoon
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does beneficiary trump all

Post by Calhoon » Sat Jul 21, 2018 9:11 am

Does the designation on an IRA trump everything else?

Have a weird situation where I am the beneficiary of what I think is pretty sizable IRA, however my mom "might have" signed over her life savings to who I'm not exactly sure.

This happened about six months ago. While my mom was going in to visit her husband in a nursing home, she stopped by two people from the state who were waiting for her. What exactly transpired isn't clear. All my mom remembers is the woman saying "we have a lot of money to work with". She wasn't sure if she signed any paperwork or not, but the fact that it's come up several time in conversations where she's brought it up makes me wonder.

My mom is a severe alcoholic, has sustained several head injuries, and goes in and out of periods of lucidity depending on if she's been drinking that week, and so this being hazy isn't surprising as it might seem. Couldn't find any paperwork, couldn't find any cards or names, but am quite certain the encounter happened.

As far as my mom's husband, what happened was my mom saved the money from my late father's inheritance for 30 years, married this...guy, and then a couple years later, drunk, he falls down the stairs and winds up in a nursing home. Very expensive, and since the second husband hadn't saved so much a penny the state was looking to fund his stay with my father's life insurance. So, whoever these people were the encounter had something to do with that.

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Kenkat
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Re: does beneficiary trump all

Post by Kenkat » Sat Jul 21, 2018 10:04 am

Yes, the beneficiary designation takes precedence over any instructions in a will or state probate laws.

chevca
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Re: does beneficiary trump all

Post by chevca » Sat Jul 21, 2018 10:11 am

Yes, beneficiary trumps all.

Have you tried researching this with the state rather than going off mom's fuzzy memory? How does the state have access to your father's life insurance? Was the life insurance not paid out when he passed away? Does the nursing home know anything about this and who these two folks were?

Sounds fishy... like a scam or something.

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cheese_breath
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Re: does beneficiary trump all

Post by cheese_breath » Sat Jul 21, 2018 11:58 am

I don't understand what this has to do with IRA beneficiaries.

What does you being beneficiary on an IRA have to do with mom signing over her life savings? Is this the IRA you're referring to?

If so, she would either have to change the beneficiary to them or cash out the IRA.

Don't let her do either. Have her see an elder law attorney. There are ways to shelter her IRA from the Medicaid countdown assets if she's interested in that.
The surest way to know the future is when it becomes the past.

Jablean
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Re: does beneficiary trump all

Post by Jablean » Sat Jul 21, 2018 12:48 pm

If she will let you, you need to see the financial records of where the IRA is hosted to see if money has been coming out, who the current primary beneficiary is, how the IRA is titled, etc. You may have been the secondary beneficiary when your dad died, but if your mom got it instead of you at that time then she was first beneficiary and those funds may be totally hers now and you don't have a leg to stand on.

Dottie57
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Re: does beneficiary trump all

Post by Dottie57 » Sat Jul 21, 2018 12:50 pm

Calhoon wrote:
Sat Jul 21, 2018 9:11 am
Does the designation on an IRA trump everything else?

Have a weird situation where I am the beneficiary of what I think is pretty sizable IRA, however my mom "might have" signed over her life savings to who I'm not exactly sure.

This happened about six months ago. While my mom was going in to visit her husband in a nursing home, she stopped by two people from the state who were waiting for her. What exactly transpired isn't clear. All my mom remembers is the woman saying "we have a lot of money to work with". She wasn't sure if she signed any paperwork or not, but the fact that it's come up several time in conversations where she's brought it up makes me wonder.

My mom is a severe alcoholic, has sustained several head injuries, and goes in and out of periods of lucidity depending on if she's been drinking that week, and so this being hazy isn't surprising as it might seem. Couldn't find any paperwork, couldn't find any cards or names, but am quite certain the encounter happened.

As far as my mom's husband, what happened was my mom saved the money from my late father's inheritance for 30 years, married this...guy, and then a couple years later, drunk, he falls down the stairs and winds up in a nursing home. Very expensive, and since the second husband hadn't saved so much a penny the state was looking to fund his stay with my father's life insurance. So, whoever these people were the encounter had something to do with that.
Your mom is not on Medicaid right? If not, there was no state involvement. My suspicion is that it is the nursing home and you should contact them. At this point only the nursing home has an interest in her money situation.

stan1
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Re: does beneficiary trump all

Post by stan1 » Sat Jul 21, 2018 1:10 pm

It sounds like multiple issues are getting mixed together in your post that you need to separate out including how she holds her current assets including the inherited IRA and insurance settlement, her current husband's care costs, her legal obligation to contribute to his care, his prognosis to leave the nursing home which impacts her future liability, her ability to make good decisions, what she could do to protect her assets now (including filing for divorce) and her future estate planning needs. If the main point of the question is whether the assets in an IRA she inherited from her deceased first husband must be used to pay for the medical care of her current husband before he is Medicaid eligible my answer is you need to talk to an elder care attorney in her state.

Calhoon
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Re: does beneficiary trump all

Post by Calhoon » Sun Jul 22, 2018 9:17 am

Thanks for the replies.

Stan -- think you're right, boils down to if assets can be seized. Her second husband is on Medicaid and will be until he dies, which I'm sure is what the encounter is all about.

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cheese_breath
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Re: does beneficiary trump all

Post by cheese_breath » Sun Jul 22, 2018 9:24 am

Calhoon wrote:
Sun Jul 22, 2018 9:17 am
Thanks for the replies.

Stan -- think you're right, boils down to if assets can be seized. Her second husband is on Medicaid and will be until he dies, which I'm sure is what the encounter is all about.
In that case she definitely needs to see an elder law attorney. As I noted previously, there are ways of shielding some assets from Medicaid.
The surest way to know the future is when it becomes the past.

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Doom&Gloom
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Re: does beneficiary trump all

Post by Doom&Gloom » Sun Jul 22, 2018 10:13 am

I would be concerned that someone would convince her to withdraw funds from her IRA.

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LadyGeek
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Re: does beneficiary trump all

Post by LadyGeek » Sun Jul 22, 2018 10:43 am

This thread is now in the Personal Finance (Not Investing) forum (beneficiary).
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