Gary Rabbior is President at Canadian Foundation for Economic Education
My wife and I held a dinner party recently when the topic of end-of-life preferences came up – often a touchy, sometimes difficult, subject. Our discussion revealed that many at the table realized they had no idea what their parents’ preferences were regarding end-of-life wishes.
Most had never had such a discussion with their parents – or discussions about virtually any other matter related to matters such as transfer of family assets, designation of power of attorney, or other money and financial affairs. Most said they would be in the dark if a parent should die suddenly without time to prepare.
The reality is, this is not uncommon. The sudden death of a parent often catches families unprepared to address many challenging and sensitive matters – end of life wishes, change in the status of a spouse, status and content of a will, transfer of assets, tasks facing the executor, dealing with any outstanding debts, and so on. On many other occasions, even when the death is not sudden, many families are still unprepared.
Your family may be well-prepared and you could be able to knowledgeably address most, if not all, of these important matters. But many families are not. Why is that? Because talking about important life and money can be difficult for many people. It can be particularly challenging for seniors with their adult children.
If there have not been money talks over the course of years, starting from the teen years or even earlier, it is often difficult to get them started when one is in their 40s, 50s, or 60s and parents are in their 60, 70s, or 80s.
What topics should we talk about? How do we get the talks started? What will their reaction be to discussing money and financial situations? What questions can I ask? These can be questions considered by either generation – seniors or their adult children.
If the conversation has not yet started in the family, some topics adult children should consider starting to address are wills, transfer of assets, plans for retirement, power of attorney, and any other end-of-life wishes.
The transfer of treasured family assets or property can be done smoothly with awareness among all – or surprises can cause rifts that can last a lifetime. The final wishes of those who pass can be clear and fulfilled – or can be total speculation by those who never asked or heard what the final wishes were to be.
To initiate a conversation for the first time a good way to get started is to use a news story as a trigger, a friend’s situation, or having an exchange about a death in the extended family. If it’s the right time of the year, using “tax time” as a conversation starter could help open a discussion. If you need to get more creative, even pointing to a situation in a TV show could be used as a tactic to jump into conversation.
There are often many barriers that stand in the way of starting such talks – there are multiple children to involve or consider, there are mixed marriages in the family, there are variations in the living standards of children, there are differing opinions in terms of the wishes of senior parents, and so on.
But such discussions are extremely important. For middle-aged children, the planning of their future, and the future of their children, may well be significantly impacted by the future transfer of wealth and assets
These conversations can be awkward and tense, and it is possible that a parent is a bit closed off to talking. Reminding your loved ones that you are coming from a place of affection and respect is important. Letting them know you want to do your best to honour them and their wishes can help ease into the more sensitive topics, especially for planning for worst-case-scenarios and their end-of-life care.
To find out how your parents will react, you won’t know until you start discussing. Let them know you are there to support them and help address their concerns.
So many aspects of financial life, and life in general, can be helped by simply talking – sharing information, testing out ideas, developing plans, and managing difficult tasks and decisions. And, conversely, there can be many problems, so much tension, and so much uncertainty when talks never happen.
If you have had such talks, keep them going. If you have not, you might want to give it a try. Your future, whether you are a senior or the child of a senior, could be dramatically impacted by the outcome of such talks.
The Canadian Foundation for Economic Education and Scotiabank have teamed up to develop the online resource “Let’s Talk Money: Seniors” to encourage and support important money talks between seniors and their adult children.
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