Talking to your adult kids about your finances and how you plan to divvy up your money after your death may be one of the most important conversations you'll ever have. It gives you the chance to tell the kids how you want your estate to be handled. It lets your kids know whether they need to worry about supporting you in your old age or whether they'll get help paying for their children's college education. And it sets them straight as to whether they will get a windfall, a topic that can be a huge disconnect between parents and children.
So, you have committed your estate plan to writing. It has been signed, witnessed and notarized. Done? Not so fast. Talking now with your kids and family is the best way to give life to your estate plans.
The heavy legal work of estate planning is done in ink and paper, often also in a banker’s ledger. However, the heart and even much of the practical work is done in conversation with your loved ones. So how do you start and go about this talk?
This is a difficult subject, but fortunately it is one for which there is much advice. Consider a recent Kiplinger article titled “The Family Money Talk You Must Have.”
That article gives both pithy advice and stories to back it up. The key lesson is to stop avoiding the topic, but to engage it head on. There are many reasons to avoid the family wealth and estate planning topic. Every family has its own dynamics.
Maybe you do not know how to say there is an “estate.” After all, you may have kept your financial condition close to the vest over the years. All the same, what is unknown cannot be planned, either by you (the one establishing the plan) or by the heirs who will receive it.
Well, how do you get there and how does the rest of the conversation go? Good questions to ponder. Remember, the answers depend almost entirely on you, your family, and the assets to discuss.
Reference: Kiplinger (November 2013) “The Family Money Talk You Must Have”