A recent survey conducted by CIBC found that Canadian adults are finding it hard to talk about senior care and financial support. It’s particularly hard because adult children feel “uncomfortable” broaching the subject. In cases like this, having an opening script might be useful.
That was the suggestion of Morgan Stanley Wealth Management. In a recent blog post on its site, the global financial services provider noted that adults in the US face a similar issue, with only 42% of adult Americans having any kind of estate planning documents at all.
“Often the issue is simply a difficulty starting a conversation about estate planning,” the firm said in its post. To help adult children open communication lines, it suggested four questions they could ask:
- “Have you spoken with a lawyer about an estate plan?” – Thirty-one per cent (31%) of aging Canadian parents are worried about becoming a financial burden on their families. Similarly, 26% of Canadian adults are concerned about how they should help manage their parents’ finances. It’s an emotional issue, but both parties need to understand the need for a plan if and when the unthinkable happens.
- “Have you drawn up any paperwork so you’re prepared in case of illness or incapacity?” – The CIBC survey showed only 43% of Canadian boomers aged 55 and above have talked with the people they want to take over their finances, and even fewer (22%) have taken steps to formalize their choice. As they grow older, parents’ ability to make financial and medical decisions will deteriorate. For that reason, they should choose the people they think should take the reins and give them the appropriate legal authority.
- What are your priorities for the future use of your money? What causes are important to you? – Almost two-thirds (62%) of adult children in Canada have not talked with their parents about how they should handle the latter’s financial affairs, and around 40% don’t feel comfortable discussing it or worry about looking like they’re “only after their [parents’] money.” Asking questions like this will help adult children broach the subject respectfully.
- Which other family members should be involved in the planning process? – Estate planning can be particularly difficult for large families. Creating a family tree together will help family members visualize their family hierarchy and gain knowledge about relatives. Once constructed, the chart can be instrumental in avoiding conflicts when it comes to wills and control of the estate.
Most families will benefit from the input of a third party like an advisor when it comes to their estate plans. However, family talks are also essential; not only can they help establish priorities, but they can also help family members address possible issues and hopefully nip problems in the bud.
by Leo Almazora05 May 2017
http://www.wealthprofessional.ca