Do you find it difficult to talk to your adult children about your financial life? Do you need to change your own mindset from viewing them as “little kids” despite the fact they might tower above you? If your children have matured into responsible adults, now may be the time to start including them in financial discussions.
If you’re finding it difficult to discuss with your adult children what should happen with your finances towards the end of your life, you’re not alone. Here are a few tips for beginning “The Talk” with your adult children.
Organize Your Financial Life
Before “The Talk” takes place, first make sure your financial house in order. If this is too overwhelming for you to do by yourself, invite your child to help you. Document your assets and liabilities, and put important documents in one easily accessible location. Consolidate accounts including bank accounts, IRAs, and brokerage accounts. Consolidating is key. Not only is it easier to keep track of everything in one place, but having all assets together enables you to manage a clear financial plan.
Once your accounts are organized, it may be prudent to make sure someone else has access, if needed. What would happen if you disappeared? Would your children be able to manage your estate and pay off debts? Giving them access to all the information in one spot can minimize future stress.
Make Your Estate Plans Known
Share your distribution intents. Make sure your estate documents are up-to-date and easily understood. Don’t assume your children know how you want your estate divided up after your passing. In the emotionally wrenching time after a parent’s death, no one wants to deal with financial surprises.
With the guidance of your lawyer and input from your financial advisor, create/update your estate planning documents to reflect your current wishes. Your job isn’t over when the documents are complete. The hard part may be sharing your intentions with your adult children. Encourage them to ask questions and give feedback. While the decision on what to do with your estate is ultimately your decision, I never met anyone who wanted his estate plan to create familial strife.
At Profile, we can help you navigate these difficult conversations and work with your loved ones closely to ensure assets transfer smoothly across generations. Click here to learn more about how we facilitate accessing an inheritance from overseas.
Douglas Goldstein, CFP®, GFP®, is the director of Profile Investment Services, Ltd. www.Profile-Financial.com He is a licensed financial professional both in the U.S. and Israel. Call (02) 624-2788 for a consultation on how to set up your American assets to meet your financial goals. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates. Neither PRG nor its affiliates give tax or legal advice.
Published February 29, 2024.