The Importance of Difficult Discussions

Have you ever noticed that some discussions are easier to initiate than others? Interestingly enough, some of the most difficult discussions are with our own family members.

No matter how difficult, there is one topic that every family needs to discuss; estate planning. Discussing your eventual death, and the ensuing financial plans with your loved ones can be emotionally challenging. However, it will offer immense rewards in maintaining family harmony,and ensure your wishes are carried out, as you desire.

Keeping Family Harmony If you have adult children they should understand what they might inherit,and how and when it will be distributed. It is important for them to understand why one sibling may be treated differently than another. The discussion about who is to run things, and what will govern their decisions, must also be set forth in advance.

A survey conducted by AARP and the Scudder Investment Program, found that 20 percent of Americans age 50 and over had experienced family fights over inheritance issues. Of those reporting no conflicts, 63 percent said they had known what to expect in advance, and 82 percent of them believed they were treated fairly.

You also need to let your family know who will be making your personal, healthcare, and financial decisions, if you are unable to. Family members should understand your healthcare wishes, and you should discuss plans for long-term care; including how it will be paid.

Not surprisingly, there are other related issues that you should address as well. Of course, there are many financial and non-financial matters that must be resolved promptly, and correctly, when someone passes away. Therefore, it is pertinent that estate plans are prepared and shared with your family. Without proper planning and execution, hundreds of thousands of dollars can be lost to taxes.

Avoiding the Treasure Hunt Help your family avoid the “treasure hunt,” through your personal effects, by making distributions in a written memorandum that is referenced in your will or trust. Make certain they know where you keep important financial and legal paperwork. They should also know whom the go-to person, or financial institution is when the time comes.

It is also a good idea to make sure your legal documentation is up-to-date, given changes in the law and your personal circumstances. Too many well-laid plans fail when they are not correctly maintained. It is a good idea to have your plan reviewed every three years by an estate-planning professional. Many estate planners, including our firm, offer this service at no charge.

Like most things in life, prior planning is the key to success. So, it goes without saying that when it comes to your estate, planning and open communication today, are essential for family harmony tomorrow.