Wondering about your parent’s financial situation, and how their finances may one day help or hinder you, can feel awkward. People may expect an inheritance to help cover the care they have provided their parents. Others may assume any money left will naturally be split between all remaining family members.
However, assumptions can create a more awkward situation that can negatively affect your finances later on. Instead, you can help make an inheritance discussion more effective by following these tips and seeking the guidance of a financial advisor or estate planning attorney.
Spark the discussion in a neutral way
Coming right out and asking, “how much money will you leave me?” may not be received well in even the most open of families. Discussions about money are often emotional and have taboos in some cultures.
It can be helpful to mention to the whole family that some future planning is needed and indicate that your goal is to save money for everyone in the long run.
Encourage everyone to plan together
Point out that planning ahead can help your parents, your siblings, you and your children strategize finances effectively. Topics such as important keepsakes, college funds or health concerns can be a family-wide discussion. This keeps the conversation from focusing on what your parents may or may not leave you and opens a way for them to bring it up.
Let a professional help guide the conversation
Even if the family feels they do not have complex assets and can manage their accounts and assets effectively, there is value in speaking with an attorney. Anyone can benefit from an estate plan. As a family, you can learn more about:
- How to save on inheritance taxes
- The probate process
- Division of assets and property
- Your parent’s care decisions if they become incapacitated
- Inheritance stipulations, such as age limits or college attendance
Leave space for emotions and time
The emotional side of an inheritance discussion can affect families in very different ways. Discussing the future and how things will change is difficult for many people. Make it clear that the conversation is not about money. It is about ensuring that your parents have the care they need for the rest of their lives, and how you and your siblings may need to support that.
In the end, what your parents decide to pass on financially is up to them. However, with careful planning, it is possible to manage everyone’s expectations positively.
