Money Matters – Tough Money Conversations: Your Adult Kids & Your Money
BOSTON (CBS) – Talking with your adult kids about your money, or lack of it, is not an easy conversation to have.
[Audio http://cbsboston.files.wordpress.com/2011/01/january-27-2010-money-matters.mp3|titles=Your Adult Kids And Your Money|artists=Dee Lee]
It truly is much better that you, the parent, initiate this conversation. Think about this for a minute. How did Warren Buffett tell his kids that he was giving away most of their inheritance?
This is an awkward subject to discuss with your kids for it involves talking about your money and their inheritance or lack of it.
But when you do have this conversation it also brings up your mortality and your kids may not be ready to deal with that. My daughter keeps saying, “Mom, you’re going to live forever,” but I’m not!
I think that once you hit those big birthdays you begin to think about your own mortality. And truly this conversation is better to have sooner than later!
Find a comfortable setting and time to start the conversation. If you want to involve them in your estate planning and want them to be part of it perhaps a meeting with an attorney or a financial planner is a good place to start.
If you have responsible adult children you may want to choose one as the executor of your estate. One to have your Power of Attorney and to be your health care proxy. If you have already executed your estate planning documents and you have named them in the documents, have you told them? Surprises are not good here!
Make a list of the things you want to talk about. For example:
- Where are the important documents? All of them!
- Do you want to give the kids a list of your documents?
- A list of your advisors from the financial planner to the plumber
- A list of your medications if you are taking any
- Health insurance coverage
- Long Term Care insurance
- Life insurance
- Income sources such as pensions, Social Security, IRAs
- Future housing issues such as nursing homes and assisted living facilities
- Net worth but only if you are willing and ready to share
- Estate planning issues
- Will or Trust
- who is the executor/trustee
- who gets what & why
- beneficiary designations on retirement plans, insurance policies etc.
- Health Care Proxy
- Durable Power of Attorney
- Funeral arrangements/wishes if you have made them
- Will or Trust