Discussing Your Estate Plan With Family

  • It’s your personal decision to determine whether to share your estate plans with family.
  • If you decide to talk about it, it’s usually best to prepare ahead of time.
  • Having a discussion may prompt your adult children to consider their own estate plans.

Making your plan known

The scene’s been in countless movies: The family’s gathered, tissues in hand, at the attorney’s office for the reading of the will. You can feel the tension as everyone awaits finally finding out what untold riches will be heading their way.

Does this ever happen in real life? Almost certainly not. But it does raise the question: Should you keep your estate plans secret from family members? Although it may make for good (if clichéd) cinema, it’s not right for every situation.

Keep in mind that making your estate plans known can sometimes be helpful, but in the end, what you choose to disclose is purely a matter of personal choice.

Why talk with heirs?

Most people don’t want to share the exact amount children can expect to inherit. But if, for example, they’re counting on inheriting the family business, it may be helpful for them to know what plans you’ve made about the business.

Ultimately the decisions you make about your estate are yours alone.

Or if they know you’re planning to leave part of your estate to your current spouse (i.e., not their mother), they need to know that and not count on your money to buy a house.

Sharing intentions, plans, and information can be a good approach when you are planning to treat beneficiaries differently.

For example, you might leave one adult child his or her inheritance outright and put another’s into a trust. Maybe you suspect your daughter will someday divorce her husband and he may, as part of the settlement, make a play for the inheritance. Or to sidestep the possibility of your son’s creditors eating up any money left to him, you might want to set up a trust for your grandchildren.

In cases like these, if you don’t explain the reasons for your actions, the child treated differently may be left wondering whether you trusted or loved the other sibling more.

Assuming you don’t want to overwhelm your children with sleuthing chores after you die, it’s also important to tell them who your lawyer, financial advisor, banker, and other advisors are — and where to find your important financial information and documents.

How to prepare for talks

An infographic that says Don't surprise your family

Introducing this topic can be difficult. Look for natural opportunities to initiate your discussion, such as when a friend or relative is dealing with an estate after a death.

As tempting as it is to start a conversation when your children are together for a family holiday, it’s not recommended you use Thanksgiving dinner or the hours before a wedding to launch into a talk about your estate. It’s too jarring and inappropriate. But if that’s the only time you get together as a family, give yourself some space between the joyful event and the discussion of death and inheritance.

Dealing with controversy

One reason moviemakers like the scene with the reading of the will is because what’s in an estate plan may lead to conflict, which can make for a good story. Discussing estate plans with family doesn’t change the fact they could spark controversy. But talking now gives you time to try to iron out any conflicts.

Bringing the issue out into the open lets children express their feelings and you gauge their reactions. Their responses to an inheritance dilemma, for example, might raise good points and give you a sense of how to move forward. Since they’ve probably been wondering about the situation anyway, they may have creative ideas you can incorporate into your plan that would lead to better family harmony.

Most people don’t want to share the exact amount children can expect to inherit.

It’s also possible you might positively influence the adult child’s lifestyle. For example, if you’re thinking of disinheriting one of your children because he or she has a substance abuse problem, saying so might give him or her an incentive to go into rehabilitation and counseling.

Ultimately the decisions you make about your estate are yours alone. If you are concerned about the emotional pain an estate plan can create when the way you divided things up isn’t understood (and remember you can’t respond to questions after your death), or if you want to minimize disputes among children, it often makes sense to talk now.

Talking can have a fringe benefit

Talking about your estate plans can have another potential benefit: It provides a logical opening to ask your adult children, “What plans have you made for your estate?”

Because most people think estate planning is all about death and inheritance, it’s easy to put it off. This line of thinking has two issues:

  • Estate planning is about more than death. It’s also about controlling what happens to your assets if you can’t speak for yourself, which can result from a sudden illness or accident.
  • The unexpected can happen at any time. We all know life can be unpredictable. The unthinkable can happen without warning. If your children have children of their own, it’s especially important for your children to make arrangements for your grandchildren’s financial, emotional, and physical care if anything should happen to your children.

For these reasons, and others, it can be risky to procrastinate when it comes to estate planning. To help your children get started sooner rather than later, consider introducing them to the team that helped create your estate plan, such as your attorney, Financial Advisor, and CPA.

Next steps

  • Give the matter serious thought before you decide to discuss your estate plans with family.
  • Consider consulting your attorney for advice on what to, and not to, talk about with family.
  • Prepare yourself for potential conflicts that may arise unexpectedly as a result.

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Wells Fargo Advisors and its affiliate do not provide tax or legal advice. Please consult with your tax and/or legal advisors before taking any action that may have tax and/or legal consequences.

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