You have worked hard to build your portfolio. You’ve made the estate plan, you’ve established trusts, but how do you truly make sure your financial wishes and legacy are carried on after you are gone? How do you ensure that your gifts are not squandered away, but provide a future for your children, grandchildren, and beyond? The short answer: Communication and Education.
Communication
Good communication is an art. Good communication with your family? Well, that can be a downright miracle. Whether you are talking with your parents, your children, your siblings, or your aunts and uncles, the quality of conversation can vary from person to person… and that’s just about normal, everyday things. When the subject of the conversation is money, then a whole different dynamic often comes into play.
While there are never any guarantees, telling your loved ones – in person – exactly what you want to happen with your money and legacy can make a huge impact on how and whether it will be fulfilled. Not only do they get to hear it directly from you (and not from a “letter beyond the grave”), but it gives you the opportunity to answer any questions or hash out any issues as a family beforehand, and to explain or make adjustments if needed.
The last thing you want after you’re gone is for your family to be torn apart by a legal war. Doing what may seem to be the hard thing up front – holding a Family Meeting – can save your family from strife and your financial legacy from being frittered away.
Education
Many people grow up in families that are taught to not talk about money, they’re taught that it’s a private matter. People often worry that disclosing details about their net-worth or the potential inheritance to their kids may make them become lazy and entitled. But keeping kids in the dark about financial matters usually does not encourage hard work…it just fosters ignorance. And when your kids or grandkids receive their windfall, they will likely be ill-equipped to handle their newfound wealth.
In the long run, educating them early in financial literacy may be a more valuable gift than any money you can give them.
