Sharing Financial Information with Your Children

Talking about your finances with your children can be uncomfortable, especially if those aren’t conversations you’ve initiated with your kids in the past. Now that your children are adults, and you’re starting to create your estate plan, it’s wise to have a conversation with them about your finances. Before you dive into these discussions, it can be helpful to know what information your adult children need, the best ways to bring up your estate plan with them, and how to involve them in your ongoing planning process without giving up your financial privacy and independence.

What Information Do They Need?

First, it’s a good idea to get a handle on what financial information your adult children need. At a high level, it’s wise to communicate the estate planning basics you have in place. This might include:

  • Who are the named beneficiaries on your accounts?
  • What accounts are you planning to pass on to your heirs?
  • Who is managing your finances (if you have a financial planner)?
  • Who is managing your estate (your lawyer)?
  • What is your health directive in the event that you can’t make decisions on your own?
  • Who is listed as the executor of your will?
  • Where can your children find the information they need for all of your accounts?

If you’re DIY-ing your finances, this might be a wake up call for you to get organized. Few people have their financial information saved in one central location, which can make it difficult for your adult children to wade through in the event that you pass away or undergo a medical emergency where you can’t access your money on your own.

On the other hand, if you’re working with an estate planning attorney or a financial planner, they can act as a point of contact for your family members. It’s a good idea for your children to have the contact information of this person, and to have met them a few times, so that they’re comfortable discussing your finances and the arrangements of your estate with them.

Broaching the Subject with Help

So many parents don’t discuss money with their children. In many ways, money is the last taboo topic in our culture, and it’s awkward to talk about finances - especially when the conversation implies that you’ll die or become ill. No child, adult or otherwise, wants to think about their parents passing away. Because of this, you need to broach the subject of your estate planning and finances openly, honestly, and with love.

How much you choose to disclose about your financial situation with your adult children is entirely up to you. However, a financial planner will be able to help you facilitate these conversations more easily. Having a third party in the room when you review your estate plan and financial information can make the topic less emotional and more informational. With a financial planner leading the conversation, the whole family can view the meeting as a “to do” that’s been crossed off the list, and feel the weight of worry lifted off their shoulders knowing that everyone is on the same page.

Do you need help starting the estate planning conversation with your family members? Contact us today! We’d love to help you create a financial strategy and open a dialogue between you and your adult children.

Wood Smith Advisors, a woman-owned Registered Investment Advisor (RIA), is a fee-only financial services firm that partners with its clients to simplify their financial lives. We focus on women, entrepreneurs and individuals with complex financial situations, providing objective and competent advice, education and services to help them develop and build their businesses and reach their financial goals. We can be reached by clicking here.

"Finance Made Simple" blog posts are intended for educational purposes and not for specific advice. Each person’s situation is different. Consult your financial advisor for advice relating to topics discussed.

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