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Four Tips to Help You Talk About Estate Planning with Your Family

It is never an easy conversation to start. But it's extremely important.

Photo by Jean-Frederic Fortier on Unsplash

There are points in life where thinking about the future can be exciting. On the flipside, there are also points in life when talking about the future can be awkward or uncomfortable, like planning for your late life and after your passing. In fact, one study showed 43% of parents had not reported having a detailed discussion about their long-term care plans with their adult children.[i] The difficulty in talking about long-term care, end of life plans, estates, and inheritances is exactly why it’s so important to take the time and have the hard conversations. Talking about money and death have been culturally taboo topics. But, no matter how hard the talks may seem, it’s always better to have them when you can than wait too long and lose the opportunity.

In this article, we will go over some ways to open the channels of communication around what types of documents you’ll need for retirement and estate planning. The end goal is to make sure everyone involved is on the same page and that your wishes are known and carried out by those you are close to.

Getting Started

Make a time when all affected parties are available, ideally long before there is any crisis or need to act (for example someone needs to move into long-term care, or is starting to show signs of cognitive impairment etc.) This scheduled meeting should not be a surprise to anyone involved and all members should come to the conversation expecting it to be about retirement and estate planning. Create a space that is open to questions and be ready to answer openly and honestly. Encourage everyone to talk and share their feelings as well as any concerns they have. These may not be comfortable conversations to have, but hopefully, with some regularity and a willingness to both hear and be heard, all can leave feeling like they’re on the same page.

Looking Down the Road

The first step in the estate planning conversations should be to understand every member’s long- term goals and plans. A lot of frustration comes from miscommunication, so be frank and open dialogue when having money and future discussions. Some examples of scenarios that need to be discussed would be if the retiring parents want to downsize and retire and how that affects everyone else. If there is a family business and someone is stepping down, handing over the reins, or wants to be bought out. If an elder parent became ill, who would be there to help oversee care and gain power of attorney? Because these conversations deal with emotions and money, it may help to seek the guidance of a financial advisor to function as mediator. An advisor can research, and arrange the proper documentation. An advisor can also help to clarify the more technical aspects. The presence of a financial advisor may help prevent conflicts down the line as well, by functioning as an unbiased witness.

Your Legacy

Ideally, we want to be making choices for our long-term health and happiness when we are in the best space to do so. Not properly planning our estate is a choice in the end and one that can strip you of your say when you may want it the most. Considering 64% of Americans report not having a will at all, there is the potential for a lot of hardship and unneeded stress on the part of the survivors that have to sort out the details.[ii] Having honest conversations about who should have power-of-attorney if something happened. Deciding long before who would be an executor or trustee in the event of your death. It may be good to arrange a trust or split the duties between children if some are better with money for instance and others are closer or more reliable for caretaking. While these are hard conversations to have and no one wants to think about themselves sick or passing away, it is imperative that you do. The key is to be honest and realistic in the choices. Anyone you elect to take on a power of attorney or executor role should agree wholly and have all the proper documents in order so as to receive no surprises or challenges down the line. Discussing inheritances in advance will prepare family as well, leaving nothing as a shock or surprise once you are gone.

Paper Trails

Getting your documents and paperwork in order is another must when retirement and estate planning. Make lists of all important documents and ensure that any and all parties who may need them can access them. Make sure to have master lists of online passwords, accounts, cloud storage etc. and confirm that all parties involved can retrieve anything needed if you were unable to assist. Appoint an agent who has medical power of attorney and create an advanced health care directive. Have your HIPAA release forms prepared. Other important documents are your will or trust, a durable power of attorney which could handle financial or real estate matters, letter of intent which is just an overview of your wishes that goes to your executor, guardianship designations if you have minor children and beneficiary designations for things like 401(k) or insurance plans.[iii]  

Peace of Mind

So much of the stress that comes with long-term care, end of life care and estates is due to a lack of communication and access to proper documentation. Removing the stress of trying to guess your final wishes or locate important documents, makes the entire process easier and less traumatic. We’ve all seen examples of people fighting over wills, contesting wills, or being unsure what final wishes the deceased had. Better to speak plain, lay out all the details, so that all parties are as prepared as they can be. It’s not morbid to plan ahead if anything it can be a positive experience. Knowing that your affairs are in order, that you will be taken care of if you need it and that your wishes are known can allow you to focus more on the present. Having no surprises or mysteries around inheritances, expectations tied to family wealth, business, or anything really, is a valuable gift that you can give yourself and your family. A few hard conversations can make a world of difference and give all involved peace of mind.

[i] https://www.marketwatch.com/story/how-to-have-the-money-talk-with-your-parents-without-seeming-greedy-2016-12-01

[ii] https://www.usatoday.com/story/money/personalfinance/2015/07/11/estate-plan-will/71270548/

[iii] https://www.investopedia.com/articles/pf/07/estate_plan_checklist.asp

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About the Author

Craig Cavicchia

Craig Cavicchia

As a Co-Founder, Craig brings years of hands on experience helping clients make informed investment and financial planning decisions. Craig takes great care in understanding his clients near and long term goals and implements an investment strategy around those goals.

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