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How to Talk to Your Family About Your Estate Plan

It’s a difficult but important conversation.

What happens to your assets after you die? It’s not a popular topic, and it’s probably not one you think about on a regular basis. Even less popular is the idea of discussing financial and inheritance matters with your family members. Most of us have been conditioned to believe we shouldn’t bring up such topics.

 

But what happens if you haven’t had these conversations with your parents or adult children, and you become unable to do so? Make sure your family is informed of your plans for your estate. It will make a difficult time just a little easier to deal with.

 

Why don’t people talk about their estate?

“Talking about your own death is a problem for people, [as is] talking about your finances,” says George Douglas, Executive Vice President and Trust Chief Investment Officer for Cadence Bank. “It’s not considered polite to talk about money, and it’s a societal taboo to talk about your own death in polite company. My mom didn’t tell me anything. When she passed on, I found out I had all of that responsibility to take on."

 

Douglas reports that about two-thirds of the parents he’s worked with have said they haven’t shared enough information about their wealth and their wills with their adult children.

 

This is a problem.

 

Not knowing can tear families apart

“For me, it resulted in multiple miserable months digging through documents and boxes trying to piece together my mother’s plans for her estate,” Douglas says. Many parents know for decades what their plans are, but they often don’t share the plans with their children. This might be due to the above-mentioned taboos or the fear that the next generation will squander the prior generation’s wealth.

 

“There is the belief that the first generation works and saves and builds up. The second generation lives in that environment and watches their parents work and save so they come up with a similar work ethic, maybe not as hard because they live a little better. They give so the third generation can enjoy that comfort. The third generation then exhibits a strong sense of money entitlement,” comments Douglas.

 

According to a study done by the Williams Group wealth consultancy, this belief rings true, with 70 percent of families losing their inheritance or wealth by the second generation, and a staggering 90 percent lose it entirely by the third generation. Douglas advises that choosing the right executor of your estate can make a big difference in how long that inheritance lasts. “You need to pick someone you trust; you can’t just pick the ne’er-do-well son.”

 

When do people start talking about their estates?

For many, Douglas says it takes a scare or passing in the family to bring light to the importance of estate planning and communicating those plans to your loved ones. "When a parent or grandparent starts to get sick, and they know they’re getting sick and they know they might not recover—that’s when I hear people talking about it. When something has happened to force them to confront their mortality,” says Douglas. “Unfortunately, we don’t always have that opportunity.”

 

Here is some guidance to get you started.

 

6 tips for having this conversation

  1. Acknowledge that it’s a difficult thing to talk about. As mentioned, life and death and money aren’t always considered polite topics of conversation. Acknowledging that the conversation will be more serious and difficult will start everyone off on a level footing.
  2. Offer guidance to adult children. Make sure your children are old enough to appreciate the conversation and understand the things that you’re telling them. Help them understand what your choices are and what will be needed from them.
  3. Explain who’s in charge. Are there powers of attorney or advanced health care directives in place? Again, knowing who is in charge of what will make it much easier on your family as they handle your estate.
  4. Tell them where they can find health and life insurance policies. Douglas recalls days of searching through boxes looking for any trace of information that would help him connect the dots.
  5. Present a list of every account you owe on or collect money from. This simplifies the process should you become incapacitated or unable to communicate your wishes. Often, families have to make multiple calls around town to different banks and accounting offices to even begin to track down records if they haven’t had this conversation with their loved ones.
  6. Bring in a professional if necessary. Experts like Douglas are available to assist you in the conversation, moderate or provide guidance during the discussion, and they will maintain the relationship with you long after you’ve discussed your plans with your family. If you have questions or would feel more comfortable having a professional present, don’t hesitate to ask.

 

If you’ve already set up a plan for your estate and have yet to discuss it with your family, now is the time to share those plans. “It’s a family responsibility,” Douglas says. “It’s important that everyone knows what is going on ahead of time.”

 

Download our free estate planning guide

Learn more about estate planning by downloading our free eBook, “Estate Planning: Why It’s Important and How to Get Started.” Or, if you’re ready to talk to a Cadence Bank estate planning expert, please contact us today.

 

 

This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.



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