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When it comes to being a parent, it’s never too early to start having age-appropriate talks with your children about money. With adolescents, saving and budgeting comes to mind, but as adulthood approaches, talking to them about your plan for your finances both during life and after death is one of the most important conversations you can have. It gives you the opportunity to share your long-term care wishes with your children, how your estate will be handled, and ensures your assets are distributed the way you prefer.
Start Talking Early
The earlier you start having these conversations, the better. As previously mentioned, it’s never too early to start laying the groundwork for open, honest conversations about money throughout each phase of your child’s life. Including them in discussions about how the family spends money will help them gain better insight into the importance of finances as they become young adults. This should help make future conversations familiar and easier down the road!
Related Reading: Straight Talk: Discussing Death and Dying with Your Loved Ones
Have a Family Meeting
Not everyone is comfortable talking about money—let alone aging and death. Whatever your reasons are for hesitancy, just remember that it’s better to prepare your kids now, rather than cause any confusion or family disputes about your wishes later. Long before you transfer any wealth, it would be beneficial to set up a family meeting to discuss where important documents, such as wills and estate plans, are located, what each family member can expect in the will, your long-term care wishes, and who will handle your finances and manage the estate.
If you don’t wish to have your kids manage your estate, you might want to designate a non-family member, such as a lawyer, financial planner, or a friend. Explaining your reasons for this decision may help prevent any hard feelings or misunderstanding in the future. Your end goal is to get everyone on the same page and understand your goals for distributing your wealth.
The Sensitive Subject—Who Gets What?
Discussing how your assets will be divided can often be a contentious subject. If one child will get a bigger inheritance than the others or if you plan to donate a certain amount to charitable organizations, the family meeting is the time to say so. Otherwise, if the other kids find out when the will is read, they may be emotionally blindsided, or possibly contest the will. It’s also extremely imperative to discuss who will get your personal belongings. Whether it’s your jewelry collection, antique vehicles, or family heirlooms, these items have sentimental value and should be openly discussed. Give each child the opportunity to talk about the items they cherish, so that the family can come to an agreement about how they will be distributed.
Talking about money and end-of-life issues with your kids can be uncomfortable and emotional, but it’s a conversation too significant to skip. Ultimately, you are the one responsible for making sure your estate is successfully transferred, providing your family with peace of mind for years to come.
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