Key Takeaways
- The holidays are a great time to start important family financial discussions.
- Discuss your financial situation, estate strategy, and legal preparations with adult children.
- Make sure your loved ones know your income sources, account access, and financial team.
- Communicate your values and money philosophy to guide your legacy.
- Families that openly discuss finances are better prepared to preserve wealth across generations.
Why Talk About Money During the Holidays?
As your family gathers during the holidays, it can be a good time to have a conversation about financial matters that impact your loved ones. These discussions can include your financial situation, estate strategy, and legal preparations for the future.
Getting your affairs in order is one of the greatest gifts you can give your family. Taking time during the holidays to start this conversation can make it easier to continue it throughout the year.
What Financial Information Should You Share With Adult Children?
Many families avoid talking about money. Some think it is too personal, while others fear it will create tension. However, keeping your children uninformed can lead to stress later.
Families who have open conversations about finances tend to have more stability and confidence during difficult times. Involving your children in your financial strategy helps them understand your goals and prepares them for the future.
Key Financial Topics to Share:
Income Sources
Your children should know where your income comes from, especially after retirement. Even if you do not share exact numbers, identifying income streams provides clarity.
Bill Pay
Document how bills are paid, whether automatically, online, or by mail, and from which accounts.
Passwords
Consider using a password manager or keeping a secure list that your family can access in an emergency.
Digital Footprint
If your financial records are stored online, make sure someone knows how to access them.
Your Team
Provide your family with the names and contact information of your financial advisor, attorney, and accountant. Arrange introductions if possible.
How to Talk About Estate Preparation With Family
Estate planning is about more than documents—it is about communication and values. As financial professionals, we often help coordinate between attorneys, tax experts, and families to ensure a unified approach.
The end of the year is a great time to review your estate strategy and make sure your plans still reflect your values and goals.
According to the Institute for Preparing Heirs, only 30% of high-net-worth families successfully transfer their wealth to the next generation. The most common reason for failure is a lack of communication and trust within the family.
Why Wealth Transfers Often Fail
When families do not communicate, misunderstandings and poor planning can erode wealth. Even historic families like the Vanderbilts lost fortunes within generations. With trillions of dollars expected to be transferred in the next two decades, clear communication is key to preserving your legacy.
Topics to Discuss With Your Family
Your Overall Strategy
Explain how you plan to divide assets, why you made certain choices, and what responsibilities your heirs will have.
Your Values
Share the principles guiding your financial decisions. Consider creating a family mission statement together.
Your Investment Philosophy
Provide insight into how you invest, your goals, and what lessons you want to pass down.
Estate Topics That Deserve Special Attention
Large Retirement Accounts
Most non-spouse heirs must withdraw inherited retirement plans within 10 years. Discussing this early helps with planning.
Family Trusts
Explain the structure and purpose of any trusts you have set up. Ensure your heirs understand their roles.
Sentimental Real Estate
Talk about your family’s intentions for property, whether to keep, sell, or rent it.
Business Succession
If you own a business, discuss your succession plan. Align expectations while you can still guide decisions.
Blended Families
For families with stepchildren or complex relationships, clarity prevents misunderstandings later.
Essential Legal Documents Every Family Should Have
Wills
A will outlines how your assets will be distributed and names an executor. Discuss its contents with your heirs to avoid surprises.
Financial Power of Attorney
Designate someone to manage finances if you become unable to.
Medical Power of Attorney
Choose someone to make healthcare decisions on your behalf if necessary.
Keep originals in a safe place and ensure your executor knows where to find them.
Remember:
Beneficiary designations on retirement accounts and insurance policies override wills. Review them regularly.
How to Structure a Family Financial Meeting
- Set Clear Objectives
Define what the meeting will cover, such as estate planning, budgeting, or wealth transfer. - Choose the Right Setting
Select a quiet, neutral place where everyone can speak freely. - Prepare in Advance
Bring relevant documents and anticipate questions. - Start With Transparency
Explain why this discussion matters and what you hope to accomplish. - Cover Key Topics
Discuss values, financial overview, estate plans, and family roles. - Encourage Open Dialogue
Allow questions and emphasize understanding. - Involve Professionals
Invite your financial advisor or estate attorney if needed. - End With Clear Next Steps
Summarize decisions and agree on follow-up actions.
When Is the Best Time for a Family Financial Discussion?
While the holidays offer a convenient opportunity to gather multiple generations, any time is a good time to talk about money. Major life events such as marriage, retirement, or the birth of a grandchild are also ideal moments to review and update your plans.
We Are Here to Help
Approach your financial discussions with empathy and preparation. The goal is not only to organize finances but also to strengthen family relationships.
If you would like guidance or want us to help facilitate your next family financial meeting, contact us today.