Best of Blog: Thanksgiving Post – How to Talk Finances with the Family

Following is a Thanksgiving post from November 2010 on communicating with family about finances during the holidays:

Estate planning is a gift.  Ideally, executing a will or trust is unselfish.  The intent is to benefit the heirs, while the planner gains peace of mind, but usually no financial benefit from the process.  Many parents consider a well-drafted estate plan and an organized estate as a last gift to their children.  Of course, many other parents never find the time to set things in order.  So if parents have not set up a plan, should the children ask their parents to get it done?

This is territory where it is wise to tread softly.  It can be a real benefit to children when the parents’ assets are in a living trust and probate is avoided, and if an encouraging word leads to that result, it should be a good thing, as long as care is taken.  It hardly needs saying that in families where finances are not discussed, bringing up the subject of estate planning can feel even more taboo.  It combines the uncomfortable topics of parents’ finances plus anticipating the parents’ demise.  When handled inappropriately, such a discussion can leave a real bitter taste after a holiday get-together.  Thus in starting any discussions, take pains to be tactful and respectful.  In the article linked here, a financial planner has written a respectful open letter from himself to parents on behalf of their adult children, encouraging the parents to “engage in the process.”  The author encourages his readers to provide a copy of the letter to parents while gathering over the Thanksgiving weekend.

There are other pitfalls to avoid in this process, particularly undue influence, evidence of which could be used to prevent a child from inheriting his or her share.  Clearly, pressuring a parent to name a particular successor trustee or to disinherit a particular family member may create a case of undue influence.  But simply driving a parent to an appointment with an estate planning attorney can also be evidence of undue influence.  Further, some children may feel that because estate planning benefits the children and not the parents, the children should pay for the estate planning services.  But paying for the services may also be used as evidence of undue influence.  The best course in any effort by adult children to encourage their parents’ estate planning is to be sure that it is a joint effort by all of the children and potential beneficiaries.  Sometimes that is not possible.  But even in that case, communication among the children and parents about these important topics is a healthy process, something worth finding time for over the Thanksgiving weekend.  Just not during dinner.

Photo copyright Elizabeth Billings 2010-2015

Original November 2010 Post

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