Originally published by Raymond James.
Set your loved ones up for success with honest dialogue and a thoughtfully crafted planning framework.
You’ve achieved a certain level of success, and you understand that the privileges of significant wealth come with challenges in equal measure. Among those challenges is successfully passing your wealth and values on to the next generation. Without careful planning, almost 70% of heirs’ money, assets and family harmony disappear after an estate transition.
You have the opportunity – while you’re living – to set your loved ones up for success, so to speak. A chance for open, honest communication, and for nurturing future-focused conversations about values, charitable giving and diligent stewardship. Estate planning is more than transferring money. It’s about what that money can do for future generations, and making room for your family to grow closer, stronger – to prosper. The conversations may be sensitive, but they’ll be worthwhile.
Don’t let your heir down
Research and data clearly demonstrate that lack of transparency or a shared family vision can adversely impact the rising generation. To stack the odds in your favor, you’ll need to create a framework to help your heirs flourish, strengthening family unity. Family meetings can help solidify decision-making and wealth governance – providing a structure that supports and sparks meaningful, multigenerational dialogue.
Each generation will have different ideas about how to use money to benefit their lives and those around them. While you may not always agree with your kids, give them a say in how the family wealth should be used. That can help connect generations and shape your family’s future while promoting openness and family harmony. If nothing else, family discussions will lend incredible insight into each other’s values and temperaments and will give you an opening to understand them better.
Create a road map
Support whatever conversations you have with documentation, storing legal paperwork, passwords, insurance policies, titles and deeds with a trusted attorney, advisor or in a secure online portal, like Vault, which allows you to assign various levels of access to particular people. Don’t forget to include the contact information of your estate planning team in case your heirs need it down the line.
Understand that wealth’s privileges and complexities deserve, even demand, thoughtful preparation and honest, ongoing conversations. Circumstances can and will change, as should your estate plan. So work with your advisor along with your other planning professionals to find fair answers to important questions, establish trust and open dialogue, and provide the gift of opportunity to those who matter most.
Next steps
If you’re not sure how to start the conversation with your heirs, choose a topic below and let the dialogue flow naturally from there.
- Define your family’s mission statement and your intentions for your wealth and legacy.
- If something happened to you tomorrow, is your family comfortable enough with your financial details to assemble a snapshot of your assets?
- Let them know where you’ve stored necessary documents and how to access them.
Sources: Accenture; cegworldwide.com; marketwatch.com; nextavenue.org; theglobeandmail.com; Raymond James research; themckenziefirm.com; yourestatematters.com; thebluntbeancounter.com; cushingdolan.com; Journal of Financial Planning; bravotv.com; mybanktracker.com; kiplinger.com; forbes.com; legacyfamilyoffice.com; shwj.com; stokerostler.com
