The Moneyologist: Can I sell my husband’s $850,000 house after he dies?

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Terrence Horan/MarketWatch


Dear Moneyologist,

My husband and I have been married for 15 years. We get along well with each other’s adult children, and I believe we have a good marriage. He is 72 and I am 62. We are both retired. He has a lot more money than me in savings and retirement. He has a very good pension, which now supports us. My personal retirement and savings is $1 million and his is over $3 million. My Social Security is $1,655 a month. His pension is about $10,000 a month (not counting his retirement and IRAs).

After I retired I sold my home that we had been living in and it became part of my portfolio. My husband sold his and bought a new home for us in his name only. We are both in total agreement that his money and investments would go to his two children and grandchildren and mine would go to my two children.


My husband wants to put the house in a trust that states that I could live in it and maintain it for as long as I would like, should he predecease me. Upon my death it would go to his children.


Wife, mother and stepmother


We have not finalized our new wills yet and, so, here is my problem. Our home is worth about $750,000 and has gained over $100,000 in equity. My husband wants to put the house in a trust that states that I could live in it and maintain it for as long as I would like, should he predecease me. Upon my death it would go to his children. He has annuitized a portion of his pension so that it would be possible for me to do this although not with the same income I am receiving now, which is OK with me. If we both continue to live a long life together, this would not be a problem. We are both in fairly good health.

If he were to die next week, could I sell our $750,000 home and buy something less expensive and less expensive to maintain, closer to my children? Would the remainder of the money go his children at that point and upon my death the proceeds of the house go to them? Would they have a say in what I did with the house and where I lived? If I did not want to live in that house and maintain it by myself, what are my options short of turning it over to them immediately and using my own retirement money to set up a new residence?

I am a very independent person, and would not want anyone telling me what to do, even my own children. We live in Florida. I want to be fair to everyone. I left a good job that I liked and it would not be possible for me to go back. I really would not want to take money out of my retirement to purchase a new home. This is really causing me a lot of anxiety.

Wife, mother and stepmother

Dear Wife,

Now is the time to have this conversation. Too many families fall out over wills and inheritance, especially when there are millions of dollars involved.

It’s smart of your husband to buy a home for you both to live in for the rest of your lives, put it in a trust and also to deed it to his children. That’s clear, and fair. He is also including you in the decision-making process. Not doing so has led to the kind of 11th-hour maneuverings by a stepmother that you would expect to read in a Grimms’ Fairytale. You want to avoid that. (Exhibit A: The stepmother who sold the family home for $1 million even though it was left to her husband’s children. That’s the kind of outcome you want to avoid.)


You want to avoid the kind of 11th-hour maneuverings by a stepmother that would expect to read in a Grimms’ Fairytale.


The Moneyologist


“You are limited only by the imagination of the person drawing up the trust,” says Mike Repak, vice president and senior estate planner at Janney Montgomery Scott, a financial services, wealth management and investment banking firm in Philadelphia. It seems like your husband is currently suggesting giving you a “right to occupy” the home. In that case, you would not have the right to sell the home and, if you decided to move, the trust would treat this as if you had died (sounds grim rather than Grimm, I know), sell the home and divide the proceeds between your stepchildren. Or the trust could allow you to downsize, but the money made on the transaction goes directly to your stepchildren). Or your husband could stipulate that you receive any appreciation on the value of the house while you live there, if you decide to move.

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One option for you and your husband: Repak says the trust could also stipulate your home as a “life estate,” providing you with the right to own the home for the rest of your life, whether or not you physically occupied the property. “This would provide you the option to move out and rent the home, using it as an income property to fund your current lifestyle,” he says. You could also take out a term life insurance policy on her husband, assuming he’s still insurable, in order to have a nest egg if he is not willing to provide you with a preference on the proceeds of the house in the trust. “Oftentimes, life insurance is an easy way to solve the problem of mental accounting when money is going different directions to different parties,” Repak says.

Talk to your husband. Finalizing these details now ensures transparence, good family relationship, peace of mind and, most of all, helps prevent this kind of macabre ending.



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