STILWELL FINANCIAL INC.
                          EMPLOYEE STOCK PURCHASE PLAN
                              ---------------
                                             , 2000


                                    1. PURPOSE

     The purpose of this Employee Stock Purchase Plan is to encourage and
enable Eligible Employees of Stilwell Financial Inc. ("Stilwell") and certain
of its Subsidiaries and Affiliates to acquire proprietary interests in Stilwell
through the ownership of Common Stock in order to establish a closer
identification of their interests with those of Stilwell by providing them with
a more direct means of participating in its growth and earnings which, in turn,
will provide motivation for participating Employees to remain in the employ of
and to give greater effort on behalf of the Stilwell Group.

                                   2. DEFINITIONS

     The following words or terms, when used herein, shall have the following
respective meanings:

     (a) "Plan" or "The Plan" shall mean and refer to this Stilwell Employee
Stock Purchase Plan.

     (b) "Stilwell Group" shall mean and refer to Stilwell, and its
Subsidiaries and Affiliates collectively.

     (c) "Stilwell" shall mean and refer to Stilwell Financial Inc.

     (d) "Shares," "Stock" or "Common Stock" shall mean and refer to shares of
$0.01 par value Common Stock of Stilwell, which it is authorized by its
Certificate of Incorporation to issue.

     (e) "Committee" or "The Committee" shall mean and refer to the Committee
appointed by the Board of Directors of Stilwell, to administer this Plan.

     (f) "Eligible Employee" or "Employee" shall mean and refer to a person
regularly employed by Stilwell or those of its Subsidiary or Affiliated
Entities designated by the Stilwell Board of Directors on such date as shall be
designated by the Committee for any offering of Stock made pursuant to this
Plan; provided, however, persons whose customary employment is for only 20
hours or less per week or for not more than five months in any calendar year
shall not be an "Employee" or an "Eligible Employee" as those terms are used
herein.

     (g) "Purchase Period" shall mean and refer to the number of calendar
months during which installment payments for Stock purchased under the Plan
shall be made.

     (h) "Option" or "Options" shall mean and refer to the right or rights
granted to Eligible Employees to purchase Stilwell's Common Stock under an
offering made under this Plan pursuant to their elections to purchase.

     (i) "Subscription Period" shall mean and refer to that period of time
prescribed in any offer of Stock under this Plan beginning on the first day
Employees may elect to purchase Shares and ending on the last day such
elections to purchase are authorized to be received and accepted.

     (j) "Average Market Price" shall mean and refer to the mean of the high
and low prices for Stilwell Shares traded on the New York Stock Exchange.

     (k) "Annual Pay" shall mean and refer to annual base rate of pay as
determined from the payroll records on such date as shall be designated by the
Committee for any offer of Stock made pursuant to this Plan.

     (l) "Maximum Purchase Price" shall mean 85% of the Average Market Price on
the Date of Grant designated by the Board of Directors or the Committee under
an offering made under this Plan, or if no Shares were traded on that day, on
the last day prior thereto on which Shares were traded.

     (m) "Outstanding Election" shall mean an election to purchase Stock in an
offering under the Plan, or that part of such an election, which has not been
canceled (including voluntary cancellation by the Employee and deemed
cancellations under Paragraphs 14 and 15) prior to the close of business on the
last business day of the Purchase Period.

     (n) "Subsidiary," "Affiliate" or "Affiliated Entity" shall mean any
corporation (other than the employer corporation) in an unbroken chain of
corporations beginning with the employer corporation if, at the time of the
granting of the Option, each of the corporations other than the last
corporation in the unbroken chain owns Stock possessing 50% or more of the
total combined voting power of all classes of Stock in one of the other
corporations in such chain.

     (o) "Active Service" shall mean and refer to the state of being paid for
services performed or paid while absent for sickness, vacation, holidays or
paid leave of absence, but shall not include termination or severance payments.

     (p) "Date of Grant" shall mean the date designated by the Board of
Directors as the date Options are granted to Eligible Employees pursuant to an
offering made under this Plan.

                           3. SHARES RESERVED FOR PLAN

     A total of 4,000,000 Shares of Stilwell's authorized and unissued $0.01
par value Common Stock are reserved for this Plan.  The Shares so reserved may
be issued and sold pursuant to one or more offerings under the Plan.  With
respect to any such offering, the Board of Directors or the Committee will
specify the number of Shares to be made available, the length of the
Subscription Period, the length of the Purchase Period, the Date of Grant and
such other terms and conditions not inconsistent with the Plan as may be
necessary or appropriate.

     In the event of a subdivision or combination of Stilwell's Shares, the
maximum number of Shares which may thereafter be issued and sold under the Plan
and the number of Shares under elections to purchase at the time of such
subdivision or combination will be proportionately increased or decreased, the
terms relating to the price at which Shares under elections to purchase will be
sold will be appropriately adjusted, and such other action will be taken as in
the opinion of the Committee is appropriate under the circumstances.  In the
case of reclassification or other changes in Stilwell's Shares, the Committee
will make appropriate adjustments.

                          4. ADMINISTRATION OF THE PLAN

     This Plan shall be administered by a Committee appointed by the Board of
Directors, consisting of not less than three members of the Board who are not
eligible to participate in this Plan and one of whom shall be designated as
Chairman of the Committee.  The Committee is vested with full authority to
make, administer and interpret such equitable rules and regulations regarding
this Plan or to make amendments to the Plan itself as it may deem advisable.
Its determinations as to the interpretation and operation of this Plan shall be
final and conclusive.

     The Committee may act by a majority vote at a regular or special meeting
of the Committee or by decision reduced to writing and signed by a majority of
the Committee without holding a formal meeting.  Whenever under this Plan an
action may be taken by the Board of Directors or the Committee, in the case of
inconsistent or contradictory actions, the action of the Board of Directors
shall prevail.

     Vacancies in the membership of the Committee arising from death,
resignation or other inability to serve shall be filled by appointment by the
Board of Directors.

                           5. PARTICIPATION IN THE PLAN

     Options to purchase Shares will be granted to Eligible Employees as
defined above; provided, however, the Board of Directors or the Committee may
determine, as to any offering of Common Stock made under this Plan, that the
offer will not be extended to highly compensated Employees within the meaning
of section 414(q) of the Internal Revenue Code of 1986, as amended.

                6. EMPLOYEE'S ELECTION TO PURCHASE - GRANT OF OPTIONS

     In order to participate in an offering under the Plan, an Eligible
Employee must elect to purchase Shares by signing a form provided by Stilwell
showing the number of Shares the Employee elects to purchase and delivering
it before the end of the Subscription Period for the offering to the chief
accounting officer of the Stilwell Group entity by whom he is employed or
other officer designated in the offer to receive and accept such elections.
Notice that an election to purchase Shares has become effective, that the
Employee has been granted an Option to purchase Shares and showing the number
of Shares which the Employee has elected to purchase under the Option
(subject to adjustment pursuant to Paragraph 7) shall be delivered to each
participating Employee.
                     7. NUMBER OF SHARES WHICH MAY BE PURCHASED

     In each offering under the Plan, each Eligible Employee may elect to
purchase and shall be granted an Option to purchase up to a maximum number of
Shares, the total Maximum Purchase Price of which does not exceed such
percentage of such Employee's Annual Pay as specified by the Committee for the
Stock offering; provided, however, that no such Employee shall be granted an
Option to purchase less than 10 Shares in any offering under this Plan;
provided, further, that no Employee shall be granted an Option to purchase
Shares under this Plan if such Employee, immediately after such Option is
granted, owns or holds Options to purchase Stock possessing 5% or more of the
total combined voting power or value of all classes of Stock of Stilwell or of
any of its Subsidiaries; provided, further, no Employee may be granted an
Option to purchase Stock which permits his rights to purchase Stock under all
such Plans of Stilwell and any of its Subsidiaries to accrue at a rate which
exceeds $25,000 of fair market value of such Stock (determined at the time such
Option is granted) for each calendar year in which such Option is outstanding
at any time.  Any Employee may elect to purchase less than the maximum number
of Shares which he is entitled to elect to purchase.

     The number of Shares which an Eligible Employee elects to purchase in an
offering under the Plan may be reduced in the event the offering is
over-subscribed.  No Option granted to an Eligible Employee in an offering
under the Plan shall permit such Employee to purchase Shares which, if added
together with the total number of Shares purchased by all other Employees in
such offering, would exceed the total number of Shares authorized for sale in
such offering.  As of the close of business on the last business day of the
Purchase Period in an offering, the number of Shares which all Eligible
Employees have elected to purchase under Outstanding Elections shall be
counted.  If the total number of Shares which all Eligible Employees have
elected to purchase under Outstanding Elections in the offering exceeds the
number of Shares authorized to be sold in the offering, the number of Shares
for which each such Outstanding Election is effective shall be reduced on a pro
rata basis, and the total number of Shares which may be purchased pursuant to
all such Outstanding Elections shall not exceed the total number of Shares
authorized for sale in such offering.

     All Shares authorized to be sold in any offering under this Plan in excess
of the total number of Shares purchased by Eligible Employees in any such
offering shall continue to be reserved for this Plan and shall be available for
inclusion in any subsequent offering under this Plan.

                             8. PURCHASE PRICE

     The purchase price per Share (except in case of a deemed cancellation of
election to purchase) will be 85% of the Average Market Price on the last
business day of the month in which the Purchase Period ends or, if no Shares
were traded on that day, on the last day prior thereto on which Shares were
traded; provided the purchase price per Share will not be more than the
Maximum Purchase Price; provided, further, the purchase price will in no
event be less than the par value of the Shares.
                            9. METHOD OF PAYMENT

     Payment for Shares purchased pursuant to the Plan shall be made in
installments, with no right of prepayment.  Each Employee electing to purchase
Shares shall authorize the withholding from his regular pay for each month
during the Purchase Period the sums which will produce at the end of the
Purchase Period an amount sufficient to accumulate the Maximum Purchase Price
per Share multiplied by the number of Shares the Employee elected to purchase
on the election form submitted by the Employee in accordance with Paragraph 6
of this Plan.  Such deductions shall be in uniform monthly amounts in
conformity with his employer's payroll deduction schedule.  In no event shall
an Employee be permitted to complete payment for or receive any Shares after 27
months from the Date of Grant of the Option to him pursuant to Paragraph 6.

                          10. INTEREST ON PAYMENTS

     No interest shall be paid on sums withheld from an Employee's pay for
purchase of Shares under this Plan.

                          11. RIGHTS AS STOCKHOLDER

     An Employee will become a stockholder with respect to Shares which are
purchased pursuant to Options granted under the Plan when such Shares are
transferred into the Employee's name on the books and records of the Company.
Ownership of Shares purchased under the Plan will be entered on the books and
records of the Company as soon as practicable after payment for the Shares has
been received in full by the Company.  A certificate for Shares purchased under
the Plan will be issued as soon as practicable after an Employee becomes a
stockholder.  An Employee will have no rights as a stockholder with respect to
Shares for which an election to purchase has been made under the Plan until
such Employee becomes a stockholder as provided above.

                  12. RIGHTS TO PURCHASE SHARES NOT TRANSFERABLE

     An Employee's rights under his election to purchase Shares under this
Plan may not be sold, pledged, assigned, or transferred in any manner,
provided, that if an Employee's election to purchase is deemed to be canceled
due to his death, the Employee's estate or the person acquiring the
Employee's rights under the Plan by bequest, inheritance, intestacy or by
written designation filed by the Employee with the Company before death may
exercise the deceased Employee's rights under the Plan for 12 months after
such Employee's death, provided, that in no event may the Employee's estate
or such person exercise an Option under the Plan more than 27 months after
the Date of Grant.  If an Employee's rights are sold, pledged, assigned, or
transferred in violation of this paragraph, the right to purchase Shares of
the Employee guilty of such violation shall terminate and the only right
remaining under such Employee's election to purchase will be to have paid
over to the person entitled thereto the amount then credited to the
Employee's account.
                    13. CANCELLATION OF ELECTION TO PURCHASE

     An Employee who has elected to purchase Shares may cancel his election as
to any or all of such Shares by written notice of cancellation delivered to the
chief accounting officer of the Stilwell Group entity by whom he is employed or
other officer designated to accept such notice of cancellation, but such notice
of cancellation must be so delivered before the close of business on the last
business day of the Purchase Period.  If an Employee cancels his election as to
only a part of the Shares, he shall continue to make the required installment
payment with respect to the number of Shares for which his election is not
canceled.  With respect to the Shares for which he cancels his election, the
Employee shall receive in cash, as soon as practicable after delivery of the
notice of cancellation, the amount credited to his account with respect to such
Shares.

                            14. DEEMED CANCELLATIONS

(a)  Events Constituting a Deemed Cancellation

     (i) Leave of Absence, Lay-Off or Temporarily Out of Active Service

           An Employee purchasing Stock under the Plan who is granted a leave
of absence, is laid off, or otherwise temporarily out of Active Service
      during the Purchase Period may elect during such absence, for a period of
      no longer than 90 days and not beyond the last day of the Purchase
      Period, to make his installment payments in cash if payroll deductions
      are not sufficient to cover the deduction.

           If an Employee does not return to Active Service upon the expiration
      of his leave of absence or lay-off or, in any event, within 90 days from
      the date of his leaving Active Service, (unless the right to reemployment
      with the corporation is guaranteed either by statute or contract) his
      election to purchase shall be deemed to have been canceled on the 91st
      day after such Employee's leaving Active Service.

      (ii) Effect of Failure to Make Payments When Due

           If in any payroll period, for any reason not set forth in Paragraph
      14(a)(i), an Employee has no pay or his pay is insufficient (after other
      authorized deductions) to permit deduction of his installment payment,
      such payment may be made in cash at the time.  In the event of
      insufficient pay, notification requesting payment will be sent to the
      participant at his last known address.

           Subject to the above and other provisions of this Plan permitting
      postponement, if an Employee fails to make any payment, his election to
      purchase shall be deemed to have been canceled at the time such payment
      was due.

      (iii) Termination of Employment

           If, before an Employee has completed payment for Shares under the
      Plan, he resigns, is dismissed or transferred to a company other than
      Stilwell or a Subsidiary of Stilwell, or if the entity by which he is
      employed should cease to be a Subsidiary of Stilwell, his election to
      purchase shall be deemed to have been canceled at that time; provided,
      however, that the Committee in its sole discretion may in lieu thereof
      specify that there shall be a "Substitution or Assumption" (and not a
      deemed cancellation) of an election to purchase if the Committee
      determines that a company or entity and Stilwell have made satisfactory
      arrangements for such company or entity to substitute a new option for
      the Option under such election to purchase, or to assume such Option
      under such election to purchase, by reason of a transaction (A) that is a
      corporate merger, consolidation, acquisition of property or stock,
      separation, reorganization, or liquidation, as defined in Section 424(a)
      of the United States Internal Revenue Code of 1986 and regulations
      thereunder (including a spin-off, split-up or similar transaction); (B)
      pursuant to which the excess of the aggregate fair market value of the
      shares subject to the new option immediately after the Substitution or
      Assumption over the aggregate option price of such shares is not more
      than the excess of the aggregate fair market value of all Shares subject
      to the Option immediately before the Substitution or Assumption over the
      aggregate option price of such Shares; and (C) pursuant to which the new
      option or the assumption of the Option does not give the Employee
      additional benefits which he did not have under the Option.

(b)  Terms and Conditions of a Deemed Cancellation

     In the event that an Employee's election to purchase Shares is deemed to
be canceled due to a leave of absence, failure to make a payment when due or
termination of employment, each as defined above, the Company will notify the
Employee of such deemed cancellation by mailing notice to him at his last known
address.  Once an Employee's election to purchase Shares is deemed to be
canceled the Employee may elect to (1) receive cash in the amount credited to
his account at the time the deemed cancellation becomes effective, or (2) apply
this amount to the purchase of as many Shares as the amount will purchase as of
the last day of the month in which the deemed cancellation is effective and
receive the balance of the account, if any, in cash.  Such an election to
purchase Shares must be made within three months after notification by the
Company of the deemed cancellation, but not later than the last business day of
the Purchase Period nor more than three months after the effective date of the
deemed cancellation.  Unless an election to obtain Shares is made within the
allowable time periods described above, such Employee's only right will be to
receive in cash the total amount credited to his account.

     A deemed cancellation of an election to purchase Stock will become
effective at the close of business on the day the event causing the deemed
cancellation occurs, but in no event later than the last business day of the
Purchase Period.  In the event an Employee elects to purchase Shares within the
allowable time periods described above, the purchase price per share shall be
the lesser of (1) 85% of the Average Market Price on the last business day of
the month in which the deemed cancellation is effective, or (2) the Maximum
Purchase Price, provided, that in no event will the purchase price be less than
the par value of the Shares.

(c)  Terms and Conditions of a Substitution or Assumption

     If the Committee determines under Section 14(a)(iii) of the Plan to
provide a Substitution or Assumption of Options granted hereunder, the Employee
shall have no further rights under this Plan and the Employee's rights, if any,
to his account or to purchase any property in lieu of Shares shall be governed
exclusively by the arrangements effecting such Substitution or Assumption
including any stock purchase plan of the company or entity substituting a new
option for an Option or assuming an existing Option.

                           15. DEATH OF A PARTICIPANT

     If an Employee dies before he has completed payment for Shares under the
Plan, his election to purchase Shares shall be deemed to have been canceled on
the date of death.  In this event the Company will notify the Employee's estate
or designated beneficiary(ies) of such deemed cancellation by mailing notice to
the last known address.  Once an Employee's election to purchase Shares is
deemed to be canceled, the estate or designated beneficiary(ies) may elect to
(1) receive cash in the amount credited to his account at the time the deemed
cancellation becomes effective, or (2) apply this amount to the purchase of as
many Shares as the amount will purchase as of the last day of the month in
which the deemed cancellation is effective and receive the balance of the
account, if any, in cash.  Such election must be made by the Employee's estate
or the designated beneficiary(ies) within 12 months after the Employee's death,
provided, that in no event may the Employee's estate or such person make the
election more than 27 months after the Date of Grant.  Unless an election to
obtain Shares is made within the allowable time periods described above, the
only right will be to receive in cash the total amount credited to the account.

     A deemed cancellation of an election to purchase Stock will become
effective at the close of business on the day the event causing the deemed
cancellation occurs, but in no event later than the last business day of the
Purchase Period.  In the event an Employee's estate, or the designated
beneficiary(ies), elects to purchase Shares within the allowable time periods
described above, the purchase price per share shall be the lesser of (1) 85% of
the Average Market Price on the last business day of the month in which the
deemed cancellation is effective or (2) the Maximum Purchase Price, provided,
that in no event will the purchase price be less than the par value of the
Shares.

                          16. APPLICATION OF FUNDS

     All funds received by Stilwell in payment for Shares purchased under this
Plan and held by Stilwell at any time may be used for any valid corporate
purpose.

                          17. COMMENCEMENT OF PLAN

     This Plan shall commence on ______________, 2000, subject to the
occurrence of the distribution of Stilwell stock as contemplated pursuant to
that certain Form 10 and Information Statement filed preliminarily by Stilwell
with the Securities and Exchange Commission August 18, 1999, File No. 1-15253

                 18. GOVERNMENT APPROVALS OR CONSENTS; AMENDMENT

     This Plan and any offering and sales to Employees under it are subject
to any governmental approvals or consents that may be or become applicable in
connection therewith.  The Board of Directors or the Committee may terminate
the Plan at any time and may make such changes in the Plan and include such
terms in any offering under this Plan as may be necessary or desirable,
including, but not limited to, such changes as may be necessary or desirable,
in the opinion of counsel for Stilwell to comply with the rules or
regulations of any governmental authority, or to be eligible for tax benefits
under the United States Internal Revenue Code of 1986, as amended, or the
laws of any state.