Parents: 7 Ways to Talk Estate Planning to Your Kids and Family
Posted By: Shauntae Jordan on February 22, 2012 |
African American families are too often faced with financial warfare after untimely death of parents, children, and loved ones. A family talk about money is often avoided because they can be awkward, emotional, and even controversial. These discussions are essential before an emergency or unplanned expense forces the conversation. This potentially can place financial risk upon family members. The time to discuss finances is not at the burial of a loved one, but the best time is during family gatherings – weddings, graduations, reunions- offering families time to sit down together and have a meaningful discussions.
The unexpected death of pop star Whitney Houston should serve as a realistic reminder to families that lack of planning can have negative impact upon those loved ones left responsible of the estate. It should also serve as reminder to estate planning advisors to make sure that families properly fund trust that they have prepared for their heirs and every couple of years update estate documents.
Excerpt Taken From: Whitney Houston: Estate planning lesson in a sad, untimely death,
By Liz Skinner
“Celebrity stories like this are a great educational tool to share with clients and highlight what should be done, what was done wrong and what was done right,” said Andy Mayoras, a Michigan estate planner. At this point, it is too early to say what kind of shape Ms. Houston's estate was in when she died. But the six-time Grammy winner, who died Feb. 11 in a Beverly Hills hotel at 48, had a will that names her only child, 18-year-old Bobbi Kristina Brown, as the main beneficiary, press reports quoted a family friend as saying. “At the very least, hopefully, a revocable living trust was set up and, even better, a series of trusts that are funded by the estate's assets,” Mr. Mayoras said. “Would you want your 18-year-old daughter to inherit everything in a lump sum?” Along with setting up insurance policies to fund the trusts, Ms. Houston should have updated her will, any trusts and her insurance beneficiaries after her 2006 divorce from R&B singer Bobby Brown, Mr. Mayoras said.
Allow me to share, 7 ways to initiating and conducting family conversations around the important topic of financial planning.
1. Celebrate Finance - While planning your next family reunion devote time for a serious financial discussion. During this time of festivities your family members may be more open and willing to take advantage of this serious conversation.
2. Be an Example -The best way to begin the discussion of financial planning is to start by sharing your estate plan. There must be a leader or example that the family can follow. This means you must have your financial planning in action. Don’t’ expect others to do what you are not willing to do yourself. In other words, “Walk the Talk.” You may lead the conversation by saying, “Mom, I’m preparing a checklist in the event something happens to me. Do you mind looking over the documents with me to make sure you understand it?” Make sure you have several copies for your parents, children, or siblings.
3. Check your communication - It is advised that you don’t wait until the next family celebration to state that you want to talk money and planning. It is important that you prepare for the conversation. You may first start with a phone call, e-mail, or letter requesting the discussion. This will allow others to be prepared and creates less intimidation. You do not want to catch people by surprise.
4. Know Your Peeps – Make sure you prepare your discussion based upon the personalities of all family members. In other words know your role. If Dad likes to be in control it is best to frame your questions and states to fit their attitude. The ultimate goal is not to make people feel as though you are telling them what to do with their money. A know it all attitude will keep the door closed for future discussions.
5. Go for Small - The first discussion should consist of your immediate family. Keeping your discussions intimate creates openness. It is also important to invite siblings (especially the oldest). The presence of your children is important to the financial discussion. It is important that you do limit the conversation to adults. The ultimate goal is to include everyone in the discussion.
6. Practice makes it easier – It is advised that you practice the conversation with a spouse or close friend. Practicing will help you lose the butterflies and become better prepared for the conversation. At this time you can organize your thoughts, materials, and overcome objections that may arise. During this time you may request the presence of your children to discuss their concerns, ideas, and questions.
7. Bring in the expert - Enlist your financial advisor someone who has no emotional ties. A neutral third-party can reduce the tension, answer questions, and give seriousness to the meeting. At this time a financial advisor can set up student checking accounts, re-loadable credit cards, and share with student how to access accounts online. The financial advisor will help the family to focus, develop a comprehensible plan, and help children become financially responsible adults.
Tweet Coach J: @smjspeaks
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