If something happens to you tomorrow, is your family prepared to execute your final wishes?
For most, the answer is, “Probably not.”
While estate planning conversations are never easy, they are imperative. As hard as it may be, it’s best to plan when times are good instead of waiting until things go bad. Opening a line of communication between you and your kids will streamline the process significantly. Not to mention, it allows you to explain what you want and why.
Here are four tips for discussing your estate plan with your adult kids.
Tip #1: Come Prepared To Talk and Listen
Estate planning is an uncomfortable topic for most people. Before meeting, let your loved ones know the specifics of what you’d like to discuss. Doing so gives them time to prepare emotionally for a difficult conversation and write down any questions they may have.
As you prepare to meet, review the details of your plan carefully. Jot down talking points that you’ll use later to lead the conversation. You should be able to speak confidently and calmly about your plans.
Remember to leave room for questions and prepare to engage in an honest, albeit challenging, discussion.
Tip #2: Lay Out Plans For Your Health
Your children want to know you’ll be okay, making conversations about aging especially hard to get through. Aging is, however, inevitable whether you prepare for it with your family or not. Planning for a decline in health can save your children heartache, financial strain, and stress later down the line.
Consider your current health and family history. Are you susceptible to certain illnesses because your parents or grandparents had them later in life? Are there health concerns you’re facing now that could worsen the older you get?
Go over the “what if” scenarios to determine what type of ongoing care you want and how you’ll pay for it.
Some considerations to make include:
- If obtaining long-term care insurance is right for you
- Where you’ll live if you can’t care for yourself (nursing home, retirement community, move in with family)
- Who will care for you (family, part-time nurse, etc.)
- Who will make decisions on your behalf
Medical expenses can drain your retirement account quickly, especially those not covered by insurance. That’s why addressing these potential concerns now helps protect your nest egg and reduce the financial burden on your children.
Tip #3: Let Them Know Who Is Doing What
Estate planning requires the participation of multiple people (who aren’t you) to carry out your wishes. That’s a big responsibility to put on others, and you need to determine the best people for the job.
Ask multiple people to take on individual roles or give one person all the responsibility.
For example, if one child lives close by, they’re better suited to serve as your power of attorney (POA) than a sibling who lives several states away.
Also, consider your children’s availability. If one is busy raising three kids under 10, they may lack the bandwidth needed to truly meet your needs. On the other hand, if your oldest son has a track record of mishandling money, it’s in your best interest (and theirs) to have someone else manage the finances of your estate.
While discussing these decisions with your kids, consider the most common roles you’ll need to fill:
- Estate executor
- Power of attorney
- Medical directive
- Trustee
- Guardian (if you have dependents)
Once you’ve chosen who will be doing what, give your kids access to the necessary paperwork, passwords, login info, and documents needed to fulfill their responsibilities.
The last thing your children will want to do when something happens to you searches through your files for passwords and important documents. By doing this ahead of time, you’re potentially saving your children from a great deal of stress.
Tip #4: Bring Awareness to Your Wishes
No two estate plans look the same, so don’t assume your kids already know what you want. Instead, take time to communicate your wishes and desires to them. Doing so will help your children execute your plans as intended.
If you’re doing anything out of the ordinary with your estate, now’s as good a time as any to let everyone know. This could include donating a significant portion of your estate to your favorite charity or dividing assets unequally amongst family members.
Whatever your final wishes look like, let everyone know now. Doing so gives them time to process and offers you a chance to explain your reasoning or clarify your intentions.
Bonus Tip: Ask Your Advisor to Help Out
These conversations can be difficult, and having a professional to guide your discussions is a big help. Our team works with those nearing retirement to develop a sound estate plan and communicate their intentions with loved ones.
As you prepare to discuss your final wishes with your kids, don’t hesitate to reach out. We’re here to help make the process smoother and provide support.