Should You Talk to Your Kids (Or Your Parents) About Inheritance?
September 27, 2009
The subject of inheritance is one that most people studiously avoid for a number of different reasons: superstition, fear, lack of knowledge, or—as this article by Gordon Powers points out—they don’t want to appear greedy. Furthermore, many older adults were raised to believe that money was a private affair, and that talking about it was inappropriate, almost dirty. The difference in how the older and younger generations view money and its place in “polite conversation” has become so great in some cases that it’s no wonder they avoid any mention of it.
An unfortunate side effect of this disconnect is that a refusal to talk about money or your estate plans with you children means that they may have a difficult time following your wishes in regards to inheritance. According to Mr. Powers (and most of the adult children who come into our offices to create their own estate plans) “most middle-aged adult [children] really want to fulfill their parents’ last wishes, regardless of how much money they might or might not see in the end.”
So the answer to the title question is, yes, you should talk to your children about inheritance if you can. Talking about it will not only make it easier for them to follow your wishes, it may even help you determine how you would like to make a difference in the lives of your heirs.
Sharing the Nest When Adult Children Fly Home
July 21, 2009
If you have adult children then you know that it’s more than just credit limits and investment accounts that have been affected by the slow economy; companies also are tightening their belts, and people of all ages are finding it harder to get (or keep) jobs. As a result, more and more adult children have been moving back in with their parents.
Of course every parent wants to do what’s best for their child, but Ruth Mantell of the Wall Street Journal writes in her article that in this case, being tough may be what’s best. This isn’t to say that you should refuse if your out-of-work child comes to your door asking for help, but that parents or grandparents need to do what’s necessary to protect themselves before they welcome their adult children back home. “With job losses continuing to mount, older Americans’ wallets are being stretched by their own children,” Mantell writes, but having your adult children back in your home can actually be a good experience for all—if you know what to expect and take the right steps first.
In her article Mantell offers five useful tips to help keep the peace and keep your finances secure, including suggestions such as making sure everyone knows who is boss (you as the homeowner), asking for household contributions (even if all your children can afford is a token financial contribution or a contribution of manual labor), and especially preserving your retirement plans at all costs.
Although the practice has fallen out of style, multi-generational households used to be the norm. It may not be the ideal situation today, but with the right communication, and with everybody on the same page, temporarily sharing the house with your adult children can be an acceptable—and maybe even rewarding—experience.
“Mom, Dad… It’s Time for an Estate Plan”
April 30, 2009
So many clients come into our office, finish signing their estate plan, start to lean back with a sigh of relief only to sit straight up again and say “My parents really need to do this! I wish they would listen to me and come in to see you.” How can adult children persuade stubborn parents of the necessity of an estate plan?
First you need to determine if your parents actually need to be persuaded, or if they’re merely slow to follow through. Offer to bring them with you to your next appointment (if you and your attorney don’t mind), or offer to make an appointment for them with their own attorney. Some parents in very open families even like to have adult children with them at planning meetings
There are times, however, when actual persuasion is required. You may be a grown adult with responsibilities, a successful job, and family of your own, but to your parents you will always be their little girl or boy. This doesn’t mean that your parents don’t value your suggestion, but it may mean they don’t see any urgency to taking action. In these situations what your parents may need to light a fire under them is a professional outside opinion. Suggest that your parents go see their financial specialist, even offer to set up the appointment for them. Much as parents love their children, the opinions of professionals sometimes carry more weight than that of their offspring.
There are the rare occasions, however, when parents absolutely will not be persuaded. Perhaps they don’t trust attorneys, or are adamant that probate is good enough for them, or perhaps (for their own reasons) they want to maintain privacy or even secrecy. In these situations the best course of action may be to let it go. Your parents may have a change of heart when they see how happy you are with your own estate plan.
If this last is the situation you find yourself in, your best course of action may be to ask your attorney what you can do to best protect yourself from the fallout of a lengthy probate process when your parents pass away, or to discuss with you how your parents will pay for long term care. Will the burden fall upon you? Will your parents be able to qualify for a Medi-Cal or Veterans Benefits subsidy? Long Term Care expenses can, over time, be devastating to your parents’ savings and stressful for caregiver children, unless the family has a plan in place.
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