In my family it was not polite to talk about money. Only one family member was open with me and that was because she wanted me to pay her bills. Cousin Kathie was in her 80s when she asked for my help with her finances, and I took over completely when she turned 90 as she was forgetting things. She was a widow with no children. She had a financial advisor and CPA that she trusted, but they offered no advice. Fortunately for Kathie and me, she told me about her legal and financial affairs before I needed to step in.
What about your family? Do the people you expect to take over, if you are ill or when you die, know what you want and the steps they need to take to help out? Do they know where you keep your important papers? Do they know what you own, or where to find that information?
We all want to protect our families and ourselves. We start on the financial end by having insurance [health, car, liability and house insurance], and then we set aside a rainy day savings account, accumulate retirement assets, and hopefully have no mortgage or other debt in our retirement years.
An unanswered question is: “What have you done to prepare your family’s expectations at your death?” Do your children understand the approximate size of your estate? Do they know what limitations you may have placed on their inheritance and why? Do your children and grandchildren understand what you want to accomplish with the money you give them after your death?
Certainly saving taxes is one issue, but most families want to avoid generations of family discord.[1] How can you do this? Consider what you want to accomplish, and discuss this with your attorney, certified public accountant (CPA) or your financial planner to come up with a strategy to share this information with your family. That would be a good first step.
[1] “What to Tell the Children About Their Inheritance and When”, Paul Sullivan, New York Times, July 21, 2012, page B5.
