AITA Wife wants 100% in case of untimely end?

Shirley Stafford Hours
Comments 0 Comments

In the realm of financial planning and family dynamics, one man’s decision about his life insurance policy has sparked a heated debate. Faced with a $1M policy and the responsibility of safeguarding his family’s future, he now finds himself torn between his wife’s demand for full protection for their children and his desire to help his sister with a modest allocation.

The delicate balance of love, duty, and financial security hangs in the balance. Amid the excitement of planning for a new child and a future built on shared dreams, the tension of conflicting priorities casts a shadow. While his wife argues that every dollar should secure their immediate family’s well-being.

He sees a chance to offer a helping hand to his sister—a gesture he believes could materially change her circumstances. This conundrum sets the stage for an in-depth discussion about personal responsibility, familial obligations, and the often-complicated decisions that come with planning for the unforeseen.

‘AITA Wife wants 100% in case of untimely end?’

I am wanting to ear mark 5% of just my $1M life insurance policy for my sister. Here’s the details. I (35M) and my wife (33F) are family planning with our second child due in a month. I have 500k in life insurance through work and will be adding another 500k in private coverage.

Our net worth is just below 1M with about $100k equity in our house 200k in my retirement, 50k liquid. She has about 250k in retirement and 100k liquid. Plus stuff. My sister (32f) has been married for a few years with a stepson. They would like to family plan for more, but want a house first.

It seems to me they are pretty much paycheck to paycheck. I don’t foresee them getting a house soon. $50k would make a material difference in them getting a down payment (I might add this as a stipulation to get my/our money). Wife says our 2 kids would need everything I can leave them.

Wife makes about 100-150k, though probably on that lower end if I weren’t in the picture. Last detail: I have an older brother (37m) who is single and not family planning, so he can get my video games and miscellaneous, sorry buddy.. So I would like to update my will to allocate 5% of my insurance policy to my sister. WIBTA?.

Navigating the allocation of life insurance benefits is no simple task. In this case, the author faces a dilemma that pits immediate family security against a desire to assist extended family in need. Life insurance is traditionally viewed as a means to ensure financial stability for those who rely on your income after you’re gone. However, personal values and family dynamics often complicate that straightforward approach.

The core of this debate is the balance between protecting one’s immediate family and extending help to relatives who are struggling financially. On one hand, the wife insists that every penny of the $1M policy should benefit their children and secure the family’s future.

On the other hand, the author believes that earmarking 5%—or $50K—could provide crucial assistance for his sister to make a down payment on a home, thereby potentially improving her long-term financial outlook. This conflict brings to light the broader issue of how to best distribute resources in anticipation of unforeseen events.

According to Suze Orman, a renowned personal finance expert, “Life insurance should be designed primarily to protect those who depend on you financially, ensuring they have the resources to navigate a difficult transition.” This perspective underscores the traditional view: that your primary beneficiaries should be those most vulnerable to the loss of your income.

Nonetheless, it also invites a discussion about whether and how to address the needs of extended family, especially when they are in a precarious financial situation. Balancing these competing interests requires careful thought and open communication among all involved.

Another layer to this issue is the unpredictable nature of life. While the chance of an untimely death may be statistically low, the impact on a family without proper financial support can be devastating. The author’s proposal to allocate a modest portion of his policy reflects a proactive attempt to address a potential future need, albeit one that his wife finds too risky.

This scenario raises questions about priorities: Should financial decisions focus solely on the immediate family, or is there room to extend a safety net to others in need? Ultimately, those facing similar dilemmas might benefit from exploring alternative financial strategies. For instance, purchasing a separate policy for extended family support or creating a living trust could be considered.

Open dialogue, transparent planning, and expert consultation are crucial in ensuring that all parties’ needs are addressed without compromising the financial security of those who rely most on your income.

Here’s the input from the Reddit crowd:

Overall, the community expressed mixed but common sentiments. Many agree that life insurance is primarily meant to protect one’s immediate family, emphasizing that the funds should secure the future of one’s spouse and children.

Yet, a few voices recognize the merit in offering some assistance to extended family members, arguing that helping a sibling during tough times is a noble gesture. Despite differing opinions, the shared consensus underscores the importance of prioritizing those who depend most on you.

TX_gen − This is an odd situation. Life insurance is meant to provide financial security in the event of someone’s death, so unless you expect to pass away soon, it’s impossible to predict what your sister’s needs will be in the future. If you live another 40-50 years, she may not even need the money by then, or she could be in a completely different financial situation.

It would make more sense to help your sister in the present if you really want to support her financially. That way, you’re providing assistance when she actually needs it, rather than tying up money in a life insurance policy that may or may not be relevant decades from now.

TheGreenPangolin − Kinda YTA. Just because you aren’t thinking this through. You’re assuming that your wife is going to go on working her same job if you die. What if you both die? What if you get killed in a car accident and that same accident makes your wife disabled and unable to work? Or makes one of the kids disabled and needing extra help?

What if the grief and caring for your grieving kids means your wife can’t work for a while? Your kids need everything you can give them if you die young. And while it’s noble to want to help your sister, chances are it won’t happen and they will continue to live as they are doing now and will be perfectly fine without any income from you. She doesn’t rely on you.

Life insurance is to protect the people who rely on you while you are alive when you are no longer there to be relied on. If you really want to help your sister, start saving for her now and give her money while you are alive. (Out of your own spending money- not out of any joint money). Also they might have other barriers to getting a mortgage besides the down payment. 

Edit to add: if you think this all through and decide you still want to leave 50k to your sister, that’s your choice and I don’t think you’re an a**hole if you make that choice. You just really need to think through all the possibilities and take your wife’s views into consideration before making big decisions like that. 

Villain-in-Training − YTA. Your wife is right. All the money should go to her and the kids. There are so many things you might not be even thinking of right now. A lot of kids, who experience the loss of a parent have a really difficult time coping with their new living situation for years to come. Your wife may need to stop working for a while to support the kids through their grief.

Plus all of the future expenses like college, weddings, down payments for a house or maybe they need expensive medical treatments. I don't want to scare you, but there could be situations where those 50k can make a real difference in the lives of your wife and kids.

K_A_irony − So life insurance is different then what is done with a will. The benificiary is dictated by the policy so you would need to do it on the policy not your will. Secondly the odds of you dying while your kid is young is low, so this all is probably a moot point. Third 5% is 50K so make the policy total $1,050,000 and do what you want.. This seems a weird thing to fight over.

Last_Ask4923 − Just get a separate $50k policy and make her the beneficiary. Shes waiting till you die to buy a house?? You’re all pretty young.

Inner_Tumbleweed_942 − YTA, you want her to be able to afford a house and possibly another child, so your plan is to….give her 5% of your life insurance in the event you die? Dude, you could outlive her. This is literally the most idiotic thing I’ve ever heard on here. If you want to help her afford a house, then offer to help. If she says no, then end of story.

Chemical-Season4358 − I personally think you’re NTA but that your primary duty is to take care of your wife and children, and your sister shouldn’t be on the policy. Would you give her a large chunk of money while you’re alive? If not, why would you in death?

Delusive-Sibyl-7903 − NAH.  Just leave the 1 million for your wife and take out a different 50k policy for your sister.  I am betting that such a policy costs almost nothing.  But perhaps the real issue is that your wife doesn’t feel that 1 million is enough?  Maybe a 2 million policy for her and kids, and a separate 50k policy for your sister?

Sensitive_Sea_5586 − YTA. Your responsibility is to your children. You can’t foresee the future and your children’s needs. What if your children have medical issues? What if your wife needs to be off work to care for them. If your sister’s family is not making enough money, they need to figure it out. We all make choices in our lives.

SubarcticFarmer − NTA technically speaking but this seems really weird too. If they are that behind that you need to die before they get a house, they won't ever get one. Honestly the way you phrase it is pretty derogatory towards them too, like you don't think they'll ever be able to fully support themselves. Leave your life insurance to your immediate family.

In conclusion, this debate highlights the complex interplay between financial security, family obligations, and personal values. The author’s proposal to allocate 5% of his life insurance to help his sister, while his wife advocates for full protection of their immediate family, reflects a broader challenge faced by many in planning for an uncertain future.

What would you do if faced with a similar decision? Share your thoughts, experiences, and advice in the comments below, and join the conversation on how best to navigate such delicate financial and familial choices.

Share this post

Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *