Having the “talk”
The importance of discussing inheritance with your heirs
You’ve achieved a level of financial success that allows you to share your wealth with the ones you love.
Of course, a substantial inheritance is a generous gesture that also carries great responsibility. Having a
series of conversations with your heirs – to openly discuss the transfer of wealth and what expectations
come along with it – will make sure everyone is on the same page.
As you finalize estate plans and decide how you’ll distribute your fortune, it will benefit everyone involved
to open lines of communication with presumed heirs. Oftentimes, your children have questions too, but
money (especially large sums) feels like a taboo topic. They don’t want to seem greedy, for example. Give
them permission to better understand your hopes for your family’s future.
Here’s what you should consider as you plan the conversation.
WHO?
For transparency, it’s ideal to include all involved parties in a group conversation, but you know the
dynamics of your family best. You may opt to have one-on-one discussions first to go over details with
individual heirs, then get the family together to touch on wider topics, like division of future caregiving
responsibilities or carrying on certain values with the inheritance. Consider bringing in your advisor so
your family can not only meet them but also feel comfortable asking any financial questions that arise
over time.
WHAT?
Consider what needs to be said to your children before you set a meeting. Most important is to address
exactly what’s being gifted and what’s not. Some other common threads are intentions for your wealth
and how family changes may affect the inheritance. If wealth is being distributed unequally or you’ve
decided all or some of your wealth will be donated to charity, it may be uncomfortable to talk about – but
this just means it needs to be discussed. Make a to-do list so it doesn’t feel overwhelming and write out
discussion points so you can rest assured you’ve covered everything.
Zilch! The likes of Bill and Melinda Gates and Ashton Kutcher and Mila Kunis have
been quoted saying their children will not get a windfall inheritance. You too may
feel your money could do more for your surrounding community. If you’ve never
expressed your intentions with assumed heirs, now’s the time. It’s worth explaining
why you feel strongly about sharing your money with charitable causes. Consider
giving them a say by using a donor advised fund as part of your charitable giving
plan that allows recipients to lend their advice as to which nonprofits invested
donations should benefit.
WHERE?
Have the initial inheritance conversation with your heirs in person, if possible. Logistics might get in the
way of getting the relevant family members together in one room but, thankfully, we’ve all gotten more
comfortable with technology aiding our long-distance conversations. Options like FaceTime or Zoom may
be sufficient, especially for those far away. For meetings to review documentation, for example, you may
want to consider inviting your heirs to your advisor’s or lawyer’s office. A neutral location can help put
everyone at ease; just make sure it’s not public and it’s conducive to candid, potentially emotional and
lengthy conversations.
WHEN?
Putting off difficult conversations is all too common, but it’s important to talk to your family about the
plans for your estate well before something happens. If you think plans may change over the years (and
they often do), you can let your heirs know you’ll keep an open line of communication as your wishes and
circumstances evolve. But, if you start the discussions early, at least your children will feel comfortable
coming to you with questions as time goes on. They’ll also be more prepared to jump in and assist with
caretaking duties or financial matters if the need arises.
WHY?
Financial wealth is only one part of the conversation, so it’s important to have a meaningful dialogue with
your heirs about your wishes as you age. It allows you to express your expectations for your family to
honor your legacy after you’re gone. And it also gives heirs the opportunity to plan for their own financial
future and to prepare for executing your estate once it’s time. Involving them during the planning phase
by discussing details makes your loved ones feel like part of the process. Having these deep conversations
often strengthens relationships and reinforces family values.
HOW?
You don’t want to surprise your heirs by springing the inheritance conversation on them unexpectedly.
The topic warrants a meeting (or series of them) that is solely focused on discussing your plans as you
age, from financial matters to desired living arrangements and caretaking responsibilities. Support your
conversations with any documents you may have, like legal paperwork and insurance policies, and provide
your family members with the contact information of your estate planning team for when they’ll need it
later on.
○○○
Remember, your advisor is there to support you in the conversations you have around transferring your
wealth. They have tools and information to help facilitate the series of discussions you’ll have with family
about the inheritance. By opening the lines of communication earlier rather than later, you’ll ensure your
family understands the legacy you want to leave behind with your generosity.
NEXT STEPS
Once you’ve finalized your estate planning …
• Tell your heirs you’d like to have a conversation regarding your estate and inform your advisor and
attorney of it taking place
• Plan the initial meeting for when you can focus on the topic at hand and with enough notice for your
family to prepare
• Schedule at least one follow-up discussion so your heirs can ask any questions they have
Sources: lessinglaw.com; frontierwealth.com; eksinsights.blog; Raymond James research
Material created by Raymond James for use by its advisors. The information contained herein has been
obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or
complete. Raymond James is not affiliated with any other entity listed herein. © 2021 Raymond James
Financial Services, Inc., member FINRA/SIPC. 21-BDMKT-4872 LE 4/21