Planning a Family Meeting

Philip GagliardiJune 25, 2015

Estate Planning

We have seen this situation a number of times: We receive a phone call from one of our client’s children. Their mother/father (our client) has fallen ill and are no longer able to manage their personal affairs. None of the children know where any of the estate documents are located, nor do they even know the wishes of their parents.

It always seems that parents do not want to burden their children with these types of issues. They seem to think that things will just work out because they took the necessary steps to get the plan in place. They have the will/trust, durable power of attorney and all beneficiary designations are filled out properly. But communicating the family’s investment and tax planning strategy to the next generation is just as important as having the documents prepared.

Through the family meeting, all members can ask questions and reach an appropriate level of understanding so when the time came, they will be ready to help – and not burdened with an extra layer of complexity. Another benefit of the family meeting is to build a relationship between the client’s advisors and family members to ensure the surviving family members are knowledgeable and have peace of mind.

According to an article on EstatePlanning.com, here are a few components and benefits of the Family Meeting:

  1. Ask your estate planning attorney and financial advisor to be there. They will be able to explain how your plan will work and why these decisions were made, as well as answer any questions. This will also introduce your advisors to your family members so they will be more comfortable working together in your absence.
  2. Choose a date and time that is convenient for everyone and a place that is appropriate. The room should encourage discussion but also convey the seriousness of the meeting. Your attorney or financial advisor will probably have access to a meeting room; a family room that accommodates everyone can also work. Limit the meeting to adults; arrange for childcare if necessary. Have a beginning and ending time.
  3. Make a list of topics you want to cover. This meeting should be a general explanation of what you have planned and why, in order to prepare family members for what they can expect and may need to do in the future. Encourage questions and discussion.
  4. It is important to give your children some idea of the size of any inheritance they may receive. With people living longer and long-term care expenses often lasting for years, there may be little to pass on. If they are expecting a large inheritance, it would be better to give them a realistic picture now rather than later. At the same time, it is helpful to prepare a child if a sizeable inheritance is coming their way so they don’t go on a spending spree, fall prey to a scam, or be afraid to use the money at all.

Some people want to keep their wealth a secret from their children for one reason or another. It is something that should be talked about. It is extremely important to have an open dialog. Both the clients and their loved ones often approach the meeting with a bit of anxiety, but in most cases the experience will have a positive end result. Even when there are controversial issues discussed – for example, if the parents don’t feel that a certain child is financially ready to manage an inheritance – putting that issue out in the open eventually leads to an increased level of understanding.

This article covers the highlights of this subject and should not be construed as estate planning or tax advice. For more information, please contact our office and we would be happy to help (610-651-2777).