Son talking with elderly mother

Should You Talk to Your Children About Your Estate Plan?

Deciding whether to talk to your children about your estate plan can be fraught with a host of difficult emotions — anxiety, fear, resentment, perhaps even guilt.

While many people may think of an estate plan discussion as one that is focused on what happens after their death, estate planning encompasses end of life issues as well, like planning for additional medical expenses, making decisions about what will happen  in the event of incapacitation, and taking an honest assessment of the family’s abilities to handle potentially difficult situations as well as their limitations. None of these are fun to discuss, but there are a number of particularly good reasons to sit down and have the conversation, not the least of which is that most of us handle information and discussions when we’re not in the midst of a crisis like a parent’s injury or death.

 

Why Some People Don’t Talk to their Children About Their Estate Plans

Parents commonly give a few reasons for why they’re not comfortable talking to their adult children or grandchildren about their estate plans.

  • They’re afraid that if their heirs know they have an inheritance coming, they’ll rely on that future money instead of doing the hard work of building their own wealth
  • They’re afraid that a conversation about their estate plan will cause conflict among their children and/or heirs
  • They’re not comfortable talking or thinking about their death
  • They feel like their finances are simply nobody else’s business
  • Looking honestly at the current family dynamics and the limitations of children or heirs can be difficult

But consider this: a recent Ameriprise Financial study found that 63% of those who responded felt extremely or very confident about their family’s financial future. And those 63% were the people more likely to have frequent family conversations about their long-term financial goals, their retirement planning, and their inheritance or estate planning.

Aging parents’ trepidation about talking to their children about their estate plans could sometimes be less about the discussion itself and more about a lack of confidence in their financial future. If that’s the case, a first step might be taking action to get an estate plan into place.

 

Why Talking to Your Children Is Usually the Best Idea

A 2018 Wells Fargo study showed that a majority of those aging parents who haven’t talked to their children about their end of life needs haven’t done so because they feel no urgency  — even respondents in their 80s. Unfortunately, in the 2018 Ameriprise study, 9 out of 10 adult children who have discussed estate planning with their parents say it was triggered by a life altering incident.

A conversation about your estate planning could be uncomfortable, but the 2018 Ameriprise study found that the majority of both parents and children who engaged in a conversation found the process straightforward and comfortable.

Even if you’re in the minority of people who end up with a difficult conversation, creating clear expectations and putting your heirs in a good position to handle both your estate and your end-of-life care are important gifts that you have the power to give now.

If you need some concrete reasons for starting the discussion, we’ve compiled four of the biggest advantages to taking that leap.

 

You can explain your motivations

Plenty of probate proceedings involve heirs battling with each other because they believe “Mom/Dad/Grandma/Grandpa never would have done that.”

Situations like leaving a larger portion of your estate to one child than the other, giving a majority of your estate to charity, providing each child with the same inheritance when their financial situations are vastly different, or choosing one child over others to be your healthcare proxy all have the potential to create confusion, conflict, or hurt feelings. Having a conversation now allows you to explain why you’re making the decision that you’re making.  

Perhaps you think it would be better if you didn’t have to engage in the potential conflict and just left your heirs to figure things out for themselves, but consider whether you want your heirs to end up navigating confusion and hurt in the midst of grief.

 

You can better understand what your children need

Once you’ve begun the conversation, you may find that you gain a better understanding of what your children or heirs actually need or want. Perhaps you’ve been operating under the impression that your daughter would be hurt if you didn’t make her your healthcare proxy because she works as a nurse. But as you talk to her, you find that she’s seen many families in that situation and is concerned about her ability to be rational when faced with it herself. She thinks her brother would have the kind of calm and collected demeanor to handle the difficult decisions.

Or you discover that your grandchildren have been hoping that you’d give the bulk of your estate to your favorite charitable organization because they want to support your legacy there.

If you haven’t had the conversation, you may be making estate and end-of-life decisions that you think are best for your heirs without truly understanding what they need.

 

You can prepare children for end-of-life expectations

Many adult children anticipate the need to provide support to their parents at the end of their lives, but not all are prepared for what that might entail. Giving your children accurate information about whether you have funds set aside for possible end-of-life care can help them plan for the future.

Tragedies generally occur when we least expect it, but making preparations for difficult situations that could arise can take a lot of the financial or organizational pressure off if it actually occurs.

 

You can coordinate with your children’s estate planning

Similarly, your children may be doing their own financial and estate planning. Knowing whether they’ll need to put money aside to help with medical care or whether they’ll be receiving an inheritance can help them make smart financial decisions now.

 

You can ease the burden on your loved ones

Although talking to your children and/or heirs about your estate plan is probably a good idea, it’s ultimately up to you — as is the amount of information you share if you do have a discussion. You don’t have to tell them everything or give specific numbers, but at a minimum, it is important to share contact information and the location of important documents.

By doing so, you’ll give them the resources they need to handle the administrative aspects of your death instead of digging around trying to find a will, the name of an attorney, or the access codes to a bank account while they’re also grappling with their grief.