Originally Published May 20th, 2019 - Access original publication here.
In an era of connectivity and changing social mores, individuals have become more open about subjects that once were closely guarded secrets.
Take the trend toward open adoption. While the identity of birth parents was once veiled in secrecy, today 60% to 70% of adoptions are open with that information.
A similar trend toward openness is taking place when it comes to family finances and inheritance.
Traditionally, the content of the family fortune has often been opaque until the reading of the will.
That’s not to say it’s an easy conversation: Whether you’re discussing salaries, housing costs, or tax returns, financial health is a deeply personal subject.
Inheritance is no different — in fact, the family dynamic can render it an even trickier subject to broach.
No matter how close you are, it can be a bit awkward to bring up the subject of your parents’ mortality, especially when the conversation centers on a monetary gain from their passing. Traditionally, the content of the family fortune has often been opaque until the reading of the will.
But as monetary transparency becomes increasingly popular in the workplace, the idea of what is and isn’t taboo to talk about in regard to money is shifting. And as most inheritance lawyers agree, talking about it is better than not talking about it.
Sandra D. Bowen is an inheritance lawyer who recommends seeking out an attorney to help ease any awkwardness. “Lawyers know how to accomplish desired results better than a non-lawyer trying to draft a do-it-yourself will online. We can suggest special language to use in your will and when communicating with your family members. We know how and when to use trusts to protect everyone in the family to accomplish desired outcomes.
“This is an easy conversation for young people who have minimal assets to have with their family but much harder when parents and grandparents have amassed assets and wealth and sometimes complex investments,” she said.
“A chart or list of intended distributions can be helpful to illustrate the conversation so long as it is consistent with the estate plan written in the official documents.
“Put values at the center of the conversation, not the money or the ‘stuff,’ “
Family enterprise advisor
“Talk about money in the context of needs vs. wants. Share your family story: Where did you come from, how was the wealth accumulated, where were the failures and missed opportunities? Always tie this back to values.”
Bowen brought up the fact that these conversations can be especially tricky for blended families. Biological children might feel a right to certain inheritances over stepchildren, but for the parents, it might not always be so black and white.
Family enterprise advisor Gena Rotstein urges both parties to approach these conversations by first assessing their common family values. She urges her clients to first ask: What does wealth mean to me?
“Put values at the center of the conversation, not the money or the ‘stuff,’ ” Rotstein advised. “By focusing on values, parents hear what their kids find the most important and this helps lay out the decision about what stays and what goes.
By treating inheritance as a tie to something bigger than just money, the conversation can become a bonding family experience instead of a dreaded, emotionally triggering negotiation.
Horizon Financial Group’s Pete Bush, CFP, is no stranger to just how emotional these conversations can be. “Money is only partly logical,” he said. “It is mostly emotional and behavioral.”
Every family is different, and everyone has a different relationship to money.
Bush recommends adult children broach the subject by saying something along the lines of, “We were doing some of our own financial planning, and our advisor asked us [if we] expect to have to provide financially for either of our parents, or [if we] possibly stand to inherit any wealth from them. We don’t even need to talk about it right now but I just want you to know that when you are ready, I’m ready to discuss it.”
Across the board, those who deal with inheritance matters are conscious of the fact that discussing wills is a very sensitive, often vulnerable matter.
Every family is different, and everyone has a different relationship to money, but keep in mind that in general finding ways to open the door to the conversation gently, listen to each other, and respect emotional boundaries are key factors to having a productive, healthy, and necessary discussion.