Our client, David, has a problem many people would like to have: He has more money than he can spend during his lifetime. But the problem isn’t what to do with the excess money. That’s been carefully planned out and memorialized in his will and other estate documents. The money will go to his two daughters, so decisions around how much and when are set.
So, what’s the problem? It’s that David doesn’t know how to effectively communicate to his daughters his thoughts about money and desires for how they should manage their inheritances. Like many of us, David was raised in a family where money was rarely discussed. As a result, he never developed communication skills on the topic of money.
This situation is common among financially successful couples and individuals. They have successfully prepared wills, trusts, and other documents, but the messaging about money is missing. In fact, most of our clients want to share their beliefs and life lessons about money with their adult children. Heartwarmingly, in our experience, children want to hear what their parents have to say.
In preparation for the upcoming meeting with his daughters, we helped David organize his thoughts and plan to effectively communicate with them. The more we talked, the more articulate and confident he became. He talked about regretting hoarding money and not enjoying it. He wanted to encourage his daughters not to be prisoners of their money.
With coaching and practice, he was able to diplomatically express his concern about his financially irresponsible son-in-law and describe the work-around solution we developed. Not naming his eldest daughter as executor of his estate was another potential sticking point. He gained confidence about explaining that, too.
We recommended that David not treat this meeting with his daughters as an event, but rather as the beginning of an ongoing dialogue. We urged him not to worry about covering all the points. We also encouraged him to not underestimate the “power of the written word” and to consider writing follow up emails and letters to continue to conversation with his daughters.
After the meeting with his daughters, David told us, “I blew it.” He was reflecting on the fact that he didn’t bring up most of the points he wanted to make. Nevertheless, he still sounded pleased and relieved. He was pleased that he had started the conversation and also relieved, I think, because he began making his best effort to help “his girls” manage their inheritance well.
There’s a lesson in David’s tale. Don’t make the mistake of thinking that your estate plan is complete because wills and other documents are current. You also need to talk with your loved ones. They will cherish hearing your advice and wisdom in connection with the money you give them. It’s the foundation upon which they will make money decisions going forward. Don’t put off this important conversation.