It can feel strange for an adult child to ask his or her parents about their financial plans, but it is a conversation that not enough children broach.
Eventually, the finances of your parents will affect your own, especially if they have not created or updated their estate plan. Do they have a will? Have they set up a trust? Are there clear instructions about where they want to be buried, or what they want their funeral or memorial to include?
Obscure or non-existent plans can unintentionally cause painful arguments and disagreements among siblings, cousins, children and other loved ones of the deceased. Without clear directions, no one really knows what the parent’s wishes were. Similarly, talking to parents about their financial plans and estate plans can help prepare adult children for what lies ahead financially for themselves.
How the Financial Plans of Parents Influence Their Adult Children
More and more adult children are paying attention to their parents’ finances, and are making day-to-day spending decisions, not taking on debt, and limiting spending based on the financial plans of the parents, or lack thereof, according to the Teachers Insurance and Annuity Association of America (TIAA). Confidence in the financial state and financial plans of one’s parents has much to do with age. Millennials, on average, are more confident in their parents’ finances than Gen Xers or baby boomers are of the financial plans of their parents, revealing what might be misguided optimism in the younger generation. The confidence of millennials in the finances and estate plans of their parents may be a false sense of security, particularly if they believe that they will receive a large inheritance — an inheritance they are depending on.
Conversation Starters for Talking to Parents About Estate Planning
It can take a while to get parents to open up about their financial plans and estate. Because of this, many financial planners and attorneys urge adult children to start early and simply plant the seed. Parents may open up eventually, but it can take months or even years for true dialogue on the topic of an estate plan or end-of-life arrangements. Below are some ideas about how to get the conversation started.
It is never too early or too late to discuss your parents’ estate plans. For professional assistance with creating or altering a will, trust or other aspect of an estate plan, or for the administration of an estate after a parent’s death, the Maryland estate planning attorneys at Frame & Frame are here. Call 410-255-0373 to schedule a free consultation.