The start of a new year is an ideal time to initiate conversations with family members about finances. Retirement Director Ben Rizzuto draws on the history of Queen Elizabeth I as a reminder of how important it is to think about and plan for the future. The fate of your kingdom (or at least your family) may depend on it.
A Lady Whom Time Hath Surprised
"A lady whom time hath surprised” was the way Sir Walter Raleigh described Queen Elizabeth I near the end of her life.
How could one of the great monarchs in British history be surprised by anything? This was a woman who ascended to the throne at age 25 and remained there for 44 years.
Over those 44 years, she never married, although she had numerous courtiers. She never had children and never considered her successor. Had she been an ordinary person rather than a powerful monarch, these choices would have been her prerogative and their outcome inconsequential. But a queen without an heir puts the entire kingdom at risk.
In the end, Queen Elizabeth could not overcome time. And her lack of planning (read: failure to marry and produce an heir) ultimately led to the end of the nearly 120-year reign of the House of Tudor as rulers of the kingdom of England.
A Lesson to Learn (Even for Those of Us Without a Kingdom)
The story of Queen Elizabeth I serves as a vivid reminder for those of us who have neglected important (and all-too-easy-to-delay) financial planning issues, such as estate planning and wealth transfer. And it’s an especially fitting reminder as we head into the new year – a time when many of us resolve to make positive changes in our lives.
Questions about retirement, inheritances, long-term care, end-of-life wishes – these are all topics that parents can bring up with children or children can bring up with parents. Either way, they involve important decisions that all of us will inevitably face as we get older.
Of course, the main reason we tend to put these conversations off is that these questions can be uncomfortable. Why? Because family members don’t want to worry each other. Or they feel that money is a taboo subject that could create conflicts. Or (not surprisingly) people simply don’t want to admit that they will die. In fact, a recent survey showed that people would rather talk about religion, politics and health issues before delving into money.1
While these topics can be nerve-racking, I assure you they are on everyone’s mind. And while it can be daunting to start the conversation, the feeling of relief that tends to come from finally addressing these matters and starting to make concrete plans about the future can easily outweigh the initial stress.
If you’re a parent or a child who senses that the clock is ticking when it comes to starting these conversations, we offer some ideas to help you get started on what could be your most important New Year’s resolution.
Resolving to Plan: Conversation Starters for Parents and Children
Just as with any sensitive subject, the best way to start talking about financial issues is to ease into the topic. Rather than trying to tackle specific questions about wills, beneficiaries and health care, open the conversation with some general topics and questions that will help everyone gain a better understanding of the family’s financial goals and situation.
Questions children can ask their parents:
- How do you want to spend your time in retirement?
- Whom do we call if you become incapacitated?
- What worries you about getting older?
- What are your goals and priorities? (especially important if health issues exist)
- Where are important documents kept?
- How should digital assets be handled?
Topics parents can discuss with children:
- My biggest money mistake was ___________
- The best money lesson I’ve ever learned is _____________
- I view my wealth as ___________
- I would like you to view your wealth as ___________
- The one thing I want to do before I die is __________
These topics and questions not only help ensure that everyone is on the same page, but they can also help us gain deeper insight into how our family members view and think about money in a philosophical sense. Furthermore, the answers to these questions can help parents rationalize how they would like the transfer of wealth to occur and help children understand what to expect and what’s expected as parents age.
Sure, these conversations may be uncomfortable … but not as uncomfortable as being the family whom time hath surprised. Even if the fate of an entire kingdom isn’t at stake, taking the time to plan for what lies ahead could help your loved ones be more comfortable and secure in the future.
Looking for other ways to facilitate financial conversations with family? Contact your Janus Henderson representative for more resources.
1TD Ameritrade, Financial Taboos Survey, July 2019
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