'I have a moral and ethical conundrum': My husband was killed by a careless driver. I received $2 million. What do I owe my stepdaughter?

By Quentin Fottrell

 'As the children grew, life became more complicated' 

 "I have stipulated a life estate in the home for my second husband." (Photo subject is a model.) 

 Dear Quentin, 

 I have a moral and ethical conundrum. 

 I was married for nearly 10 years to a wonderful man. It was my first marriage and his second. He shared custody of his two children, 11 and 8, when we met, but before long, both chose to live with us full-time. They were good kids, though not always easy, and over time, I built a warm relationship with them. 

 My husband's career was demanding - more than 100 flights a year - so someone needed to be consistently present at home. That became me. My own career gradually slipped into the background while I handled school runs, meals, appointments and emotional support. I came to feel like a full-time parent, even though I lost financial independence and much of my personal identity. 

 He shared custody of his two children when we met, but before long, both chose to live with us full-time. 

 As the children grew, life became more complicated. The eldest eventually had difficulties and had a serious falling out with his father; they remained estranged for years. The younger, a daughter, stayed close to us. In 2018, my husband's job took us from Canada to the U.K. After graduating from college, she joined us and we rented an apartment for her nearby. 

 Only months later, shortly before our 10th anniversary, my husband was killed by a careless driver. I knew no one in the country and my support network was an ocean away, but I chose to remain in the U.K. My stepdaughter also stayed, and we have remained close ever since. 

 The legal process took years to conclude. Because I was not working at the time and was legally classified as financially dependent, I received a larger civil-compensation award than if I had returned to employment. Combined with life insurance, the total came to about GBP1.5 million. The children were adults - 24 and 21 - and therefore not eligible for that settlement, though a Canadian policy provided them each a smaller payout. I later regretted telling my stepdaughter the full figures. 

 Second marriage 

 Years passed. I eventually remarried - another kind man, also in his second marriage - and we signed a strong prenuptial agreement. My stepdaughter, now 28, gets along well with him and his teenage son. We have a peaceful, if somewhat unconventional, blended family. 

 Financially, my second marriage is very different from my first. My husband earns minimum wage and has little savings following a difficult divorce, while I invested my settlement and found a stable, low-stress job. My salary doesn't fully support our lifestyle, but helps slow the drawdown on savings. At 48, retirement is still years away - likely my early 60s - and now the funds must support a couple rather than a single widow. 

 Since our 2024 wedding, my stepdaughter has occasionally brought up my will and suggested reviewing it together. 

 I named both my husband and my stepdaughter co-executors of my estate. In the past, she always knew the contents of the wills her father and I made together, but this time I chose not to share details. Since our 2024 wedding, my stepdaughter has occasionally brought up my will and suggested reviewing it together. She isn't hostile, but persistent enough that it makes us uneasy. We even took financial paperwork with us on holiday because we suspected she might look for it while we were gone. 

 For clarity, my will leaves a significant portion to my stepdaughter, a smaller portion to my new stepson, and the remainder to my husband. My husband has the right to live in the home for life, after which it passes to her; if he sells earlier, she receives a fixed sum. 

 I suspect she feels most of my assets ultimately came from her father and therefore should primarily return to her. Yet if he had lived, our finances would likely have been far less secure - we carried debt, little savings, and a large mortgage despite his income. Likewise, she would not automatically be able to purchase a home today on her own either. Meanwhile, my current husband contributes deeply to our life, even if not financially. He is my partner - not hers - and our shared future may last decades. 

 So aside from the discomfort of being pressed to disclose private estate plans, the question remains: what is actually fair? 

 Mrs. Anomaly 

 You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. The Moneyist regrets he cannot reply to questions individually. 

 Related: 'People are often unreasonable when money is involved': My husband, 62, gave me a 5-year life estate. Would I have to pay for a new roof? 

 As matriarch, you were fully invested in this family, economically and emotionally. 

 Dear Mrs. Anomaly, 

 You are one fair lady. 

 You gave up your career to raise your stepdaughter, and you used marital funds to do that until she reached adulthood. You moved to the U.K. to support your husband with his career, leaving your friends and family behind. And when your first husband was away, you took care of his/your child. As matriarch, you were fully invested in your new family, economically and emotionally. 

 I'm glad you don't feel guilty over receiving the compensation. As his wife, you were legally and ethically entitled to receive the $2 million payout from the lawsuit related to your husband's car accident. You are, almost to a fault, the caretaker of your loved ones. You have been taking care of everyone: your first husband's daughter and, now, your second husband and, to a lesser extent, your new stepson by remembering him in your will. 

 Your stepdaughter's questions may be as much about her place in your life, now that her father is gone, as they are about the money itself. 

 You have gone above and beyond to ensure that your husband has a comfortable life, in the event you predecease him, which is not a given - even if you are close in age - because women outlive men by roughly six years. You have protected your assets and your stepdaughter's inheritance by ensuring that you and your second husband signed a prenuptial agreement, although they're not automatically binding under the law in England and Wales. 

 So far, so fair. It may be that your stepdaughter, rightly or wrongly, wants to know that she will be taken care of, as she suffered when her father died too, and she probably regards you as a surrogate mother, even though she is aware that you may not feel bound by the same social mores that dictate what a mother might normally leave her biological daughter. You could leave her nothing, and that's OK too. 

 You opted to leave her a large sum of money to your stepdaughter, and a smaller amount for your new stepson - out of respect to both your relationship with them and their parents. Your life story is your own, and no one owes explanations about what you do or why you do it. That includes your stepdaughter, her sibling, your stepson and second husband. You don't owe anyone anything. We are all responsible for ourselves. 

 U.K. matrimonial law 

 Legally, you are on solid ground. In England & Wales, adult children can challenge a will under the Inheritance (Provision for Family and Dependants) Act 1975, but stepchildren rarely have a look-in unless they are financially dependent on the parents. Your daughter's questions about her inheritance may be as much about her place in your life, now that her father is gone, as they are about the money itself. (Likely, it's about both.) 

 Matrimonial law in the U.S. and U.K. is not an apples-to-apples comparison, but in England and Wales, payouts from civil lawsuits are not necessarily considered separate property unless they were received before the marriage. "Property owned before marriage is typically considered a non-matrimonial asset and is unlikely to be part of a divorce settlement," the London-based law firm Reiss Edwards says. 

 Prenups are not legally binding in England and Wales, but they may be taken into account by a judge when deciding on a divorce settlement. 

 "However, if the matrimonial pot does not meet the financial needs of both parties, the U.K. family court may consider splitting pre-marital assets acquired before marriage, as we explain below," the law firm adds. This includes investments such as shares, savings, and cryptocurrency; pensions, stocks and inheritances of any kind, including money or personal possessions received before getting married. 

 As for your prenuptial agreement: They are not legally binding in England and Wales, but they may be taken into account by a judge when deciding on a divorce settlement, Reiss Edwards adds. "As such, they can help to remove any uncertainty or ambiguity around each party's expectations regarding pre-marital assets." But a divorcing partner's reasonable financial needs are also taken into account. 

 So what now? Tell your daughter fairly and squarely, if you want: "I have made provisions for you in my will, and they are generous and fair, and you should not worry. However, I would like you to respect my wishes when I say that my estate plans are private and reflect my life's journey. Your estate plans, when you make them, will reflect your life's journey. I would now like to end this topic." 

 And make her a nice cup of Yorkshire Gold tea. 

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