Having That Awkward Conversation – Family Inheritance
UBS Wealth Management published a report revealing how badly families are talking about inheritance. The report indicates that it’s easier to have a will (83 percent of respondents had one) than discuss the will with children (about half have had a conversation about the will), and it’s even harder to tell children what the assets are in the will (only 34 percent of respondents discussed the will in detail).
The issue of not discussing family inheritance spans the economic spectrum including both wealthy and not-so-wealthy people, according to the New York Times. The UBS report showed that only 55 percent of people with more than $1 million talk to their children about an inheritance, while 53 percent of people with less than $1 million take the time to talk about inheritance.
Change needs to happen. Financial advisers estimate that $40 trillion will pass from baby boomer clients to their children and everyone wants that process to go smoothly. Unfortunately, when the children are given sparse details about this money, it could turn into an unorganized disaster.
A potential heir’s disinterest in asking about their loved one’s estate is understandable. “They don’t want to be perceived as greedy,” said Paula Polito, chief client officer at UBS, according to the New York Times article. However, the key is to not dwell on the loved one’s passing, but rather emphasize the need to have peace of mind; to make sure everything will be okay. A good discussion with family members ahead of time makes it a lot easier for the families after the passing of a loved one. Additionally, it is important financial advisors work with clients and the estate planning attorney to ensure wealth reception planning is in place for the beneficiaries.
At InSight Law, we encourage our clients to make the estate planning process collaborative and to ensure their family members are in the loop about the plan. It’s tough to talk about this sensitive subject, but it has to be done to ensure a smooth transition for your loved ones.