31 May 2008
Based on my title this had better be one behemoth of a problem. In 2005 I wrote an article for the accounting firm’s newsletter titled Reflections of You (I have included it in this newsletter for your review) that delved into several creative ways to discuss estate plans with your children or grandchildren. My basic concept for that article was based on the trend that we were seeing – and continue to see even more prevalently today – that no generation wants to give the next generation an entitlement mentality. Yet based on what I see happening in estate plans, I am convinced many people are doing just that based on one basic mistake – a lack of communication.
Maybe it is just us in the Midwest, but I am seeing more and more people not taking the time to open up about who they are to their heirs. It took my father’s diagnosis with cancer before he told me that money did not matter in life and only his children did. He was your typical Stearns County German who was not about to be too positive just in case someone took that for weakness. Yet when we finally got to talk about it, just months before he passed away, it became clearer to me the path he had put meüon in life and that clarity has helped me in raising my children. Some families never get that chance to communicate those values.
And that waiting, or lack of communication, is what I see in many estate plans. Talking about dying is not an exciting part of anyone’s day. But it does not have to be about dying. It is about leaving a legacy of who you are and who you want your heirs to become. I can devise a plan that maximizes tax control and passes on as much money in the most advantageous way possible. But it is up to you to explain to your children/grandchildren why you are doing that and what you want them to focus on. This is a central tenet of leadership that gets missed. As the leader of the family, it is your job to make sure everyone has the vision of what the family as a whole is trying to accomplish through the generations. And that is not just saving money on taxes.
There is a lot of uncertainty in life that is uncertainty just because someone chooses not to communicate. Once you take control of your estate plan by getting it drawn up by an attorney, take that next step and choose to talk about it, or at least write your heirs a letter about it. What you might find is that it is fun and engaging to have a very private topic that you can share with your children. It tends to bring families closer together.