Pension, retirement rights and inheritance : distribution of 401K and IRA

Fatawa Question

Assalaamu Alaykum Wa Rehmatullah Dear Brother Dr. Monzer Kahf : InShaAllah, you and your family are safe during these times of turmoil. A few brothers (in their 30s and 40s) who attend a Qur’anic tafseer program in the area of Islamic foundation, villa park (suburb of Chicago) had hosted a couple of presentations on will and testament. Several questions were left unanswered. I was asked to get a scholarly opinion, for which may I turn to you ! 1. Providing for wife who has not / and will not have any employment or personal wealth : one presenter advised that during the spouses' life-time', each execute a deed assigning their respective share of the home to the other. The intent would be that the surviving spouse will then be able to record it to own 100 % of the house at the death of the other. Is this Shari’ah-compliant ? If not, what other strategies can one opt to provide for relatively young wife ? 2. Brothers have 401 K, or IRAs for which each has named wife as 100 % beneficiary. One presenter opined that this is a gift during "life-time", and thus not subject to the one-third cap in the will. Since the retirement account will vest only on death, can it still be outside the one-third maximum ? What is the alternative ? 3. USA and overseas assets : can separate wills be written for different countries ? If so, is it okay for the each not to refer to the other one ? JazakaAllahu Khairan, Cheema

Fatwa

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Publication Date

2011-03-24

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Pensions
• Wages
• Inheritance

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-729242

• APA
• MLA
• AMA