Estate planning offers you many options for preserving and distributing your assets according to your wishes. However, the success of your plan may depend on discussing the matter with your children beforehand.
You may be understandably reluctant to have this conversation. Both death and wealth can be touchy subjects. However, it may create a destructive atmosphere of distrust and suspicion among your children if you do not talk with them openly about your plans for your assets. Here are some ideas for starting the conversation.
1. Discuss your intent
It may not be enough to simply inform your children what your estate plan says. Explain your rationale behind your decisions. Discuss what your wealth means to you and what you want your legacy to be.
2. Be specific
A study in 2011 found that over 65% of parents who intended to leave money to their children did not feel strongly that their heirs would be able to handle it. Nevertheless, the same study found that only about half of all parents had fully disclosed their wealth to their children. Discussing your assets in detail with your children helps to give them the tools they need to manage their inheritance, setting them up for success.
3. Have a dialogue
The discussion about your money and estate plan should not be a lecture. You should give your children the opportunity to express concerns and listen to them carefully. Your children have different life circumstances and temperaments. You should keep these individual variations in mind when tailoring your approach to the conversation with each child.