Aging Parents, Adult Kids Agree: Money Talks Are Hard

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By Diane Gallagher

Sure, you've dotted all the "I's" and crossed all the "T's" when it comes to taking care of your family financially. But there's an important piece that you can't avoid, even if you want to: To help your family be successful, you'll need to have the money talk.

Most adults would rather talk to their kids about sex than to their elderly parents about aging and financial planning. At the same time, aging parents don't want to admit that the time has come to have these discussions.

Give Your Family a Different Story

Transferring money from one generation to another is not exclusively for extremely wealthy families: It's important for every family to understand wishes, expectations and plans to keep the family's legacy intact.

70% of family wealth may disappear by the second generation, and 90% by the third. 70% of Rich Families Lose Their Wealth by the Second Generation  by Chris Taylor / Reuters, June 2015.

No matter the size of your family's nest egg, you'll need to have a plan to transfer any money and property. And even with a plan, you'll still need to start honest conversations about how that plan will be carried out.

Baby Boomers will hand off $68 trillion to their heirs.

$68 trillion is about to change hands in the US , CNBC, November 2018.

Face It: Money Conversations Are Hard

The reasons aging parents and their adult children avoid financial discussions may actually mirror each other. You might be surprised how similar your hesitation and discomfort might be.

For Aging Parents: For Adult Children:
It's my decision, and my family doesn't want or need this information. I'm sure my parents have a plan and have specific reasons for their decisions.
It's an unpleasant topic. I wouldn't know how to start. I don't want to think about my parents' mortality.
I've taken care of everything. It's none of my children's business. It seems greedy to ask about their money now.

Reframe the Discussion: The Money Talk Is a Gift

Rather than looking at the money conversation with dread, view honest and open discussions with your family about tough topics as an act of love and generosity.

Having these critical conversations now serves to prepare your family for what is to come, which can help reduce anxiety during a time of crisis or grief.

Set a Date: The Benefits of a Family Meeting

Coming together at a specified time gives all parties a chance to be prepared with questions, concerns and requests. A planned meeting will help you avoid making decisions during emotional times, and provides other advantages:

  • Minimize surprises. Your family will know your wishes and expectations, plus how you came to those conclusions.
  • Reduce confusion. Family members will learn what information they'll need and where to find important documents.
  • Decrease disagreements. With everyone on the same page, it will reduce the likelihood that family members find themselves at odds.

Stay in Control: Don't Let the Courts Decide

Failure to plan could result in the courts controlling how your assets are divided, your beneficiaries losing their inheritance to creditors or a judge deciding who takes care of minor children. Be prepared instead.

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Diane Gallagher
Diane Gallagher

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