If your parents’ financial affairs aren’t in order, here’s what you need to do to get them on track
There’s only one thing more uncomfortable than having a sit-down conversation with your parents about their financial matters, and that’s discussing how their financial matters will be handled when they pass away. But as your parents age, it’s important to make sure they consider what will happen to their property, assets, and dependents after death. Unfortunately, only 69 out of 100 people admit they need to have a will, while just 34 percent actually proceed to put a will in place. If you and your siblings are going to have to manage their estate, it’s completely valid to confirm that it’s properly mapped out.
This conversation isn’t easy. Here are tips to help minimize tension.
Focus on the two of them
Estate planning isn’t just about providing for their children or grandchildren: if one of your parent outlives the other, an estate plan will help ensure they’re protected. They may not have updated their estate plan in some time: perhaps the last time they touched their trust or will was when their children or grandchildren were born, but we recommend updating an estate plan one time per year. Mention to them that changes in the law, changes in assets and property, or windfalls of wealth are all reasons to regularly update your estate plan. An up-to-date estate plan will save your mom or dad a lot of grief if the other passes. At the very least, it will leave you assured that everything is rightfully documented to their liking when they both pass away.
Keep the conversation positive
Begin the conversation by asking curiosity invoking questions such as what type of legacy they want to leave behind. Use a light-hearted question to get the conversation started, but make sure you always focus on them and the result of their actions rather than how it might impact you. Once you have laid this foundation, drill down by inquiring about what would happen to one parent if the other were to pass away. Ask if they have communicated to one another their wishes regarding long-term care options and medical treatment.
Offer them options
Once you have an idea of your parents’ wishes, help them put the plan in motion. Set a good example by establishing and estate plan and revisiting it on a regular basis. Ask if your parents are interested in joining you to your next meeting or if they wouldn’t mind you accompanying them. Make it known that you are not concerned about what will be left behind to their heirs, but that you simply want to address the importance of having a will in place. Talk openly about your concerns and always come from a place of openness and understanding.
Having a conversation with your aging parents about their estate plan is important to ensure their dependents are protected and without added grief after they pass. It’s not an easy conversation, but this approach can lead to many breakthroughs. Get more guidance on setting up your own or your parent’s estate plan by contacting Anselmo Lindberg & Associates.