What’s in Your Estate Plan, Mom and Dad?

Q. Our daughter, Melanie, recently came to visit us. She told us that she and her husband will be meeting with your firm to do their estate planning and incapacity planning. Then, she inquired about what we put in our estate plan. We were taken aback by the question, and luckily, the time wasn’t ideal to have a conversation with our grandchildren jumping on our laps.

I know it will come up again. My wife and I discussed it and first and foremost, we want to consider the relationships between our daughter and her sisters. So, although we were hesitant at first, we decided it’s a good idea to have this conversation all of them. What we don’t know is how we should tell them. Should we meet with each daughter separately to focus on just one important and unique person at a time? Or is it better to gather them all in one place so everybody hears the exact same message in the same words? What things should we make sure they are aware of? Thanks for your help!

A. For those of us who have completed our estate planning and incapacity planning, the most stressful part of the process is often the prospect of telling family members what you plan to do with your assets, and what your wishes are. In many instances, parents shy away from discussing these things with their grown children, because they are afraid that children will strongly disagree with choices that are made, be angry or disappointed, will build too much on their expectations for an inheritance, or will be resentful of other heirs. As difficult as it seems, you are making a good choice to have this conversation with your adult children.

So, what’s the best way to tell your grown children about your plans, without creating family drama? That depends on your situation. For instance, do any of your daughters have special circumstances, such as difficulty handling money or a physical, mental, or emotional challenge? If so, the conversation will look different than if all your daughters will inherit equally. In most situations, however, a balanced approach to sharing information about family wealth is the best option.

Setting Up the Family Estate Planning Meeting

The purpose of your meeting will be to tell your adult children what they can expect and what roles they may play in the future managing the estate.

Before the talk, determine the goals and objectives you want to achieve and draft an outline or an agenda, with a few talking points. Choose a quiet place for the meeting that will make everyone feel comfortable and secure.

During the meeting, speak in a calming tone and use words such as “safety,” “security” and “protection.”

If the environment gets toxic, don’t lash out or shut down out of fear, anger, embarrassment, defensiveness or any other unpleasant feeling. Make sure everyone has an opportunity to speak. Should thorny issues arise, try to come up with solutions. It can be helpful to have a trusted adviser at this family meeting, to help ensure an atmosphere of tolerance, patience and impartiality.

Things to tell your children

The following is information that you should share with your children at this meeting, so they know that your estate is in order and can ensure that your plans will be carried out accordingly:

1. Who’s on your team: If you work with financial and legal professionals, compile a list of their names, addresses and phone numbers (or let them know where to find that list if they need it). Include names and numbers of your doctors, in case medical decisions need to be made.
2. Who the executor will be and where the documents are: Tell them how recently your documents were written, who will be the executor, and where they are. If your documents are more than five years old, be sure to review them with us to make sure your current wishes are represented.
3. What are the details and who will be the agent(s) for the Advance Medical Directive and Financial Power of Attorney: Disclose your feelings about life support and other end-of-life issues, and disclose who will manage your financial affairs if you no longer can.
4. Who your beneficiaries are: Tell them who the beneficiaries on insurance policies, pensions, and investments are and how to locate the paperwork. Make sure your designations are up-to-date to reflect your current wishes.
5. What financial accounts you have — and where: Put together a list of your bank, brokerage, and mutual fund accounts and your account numbers. If you have any user names and passwords on the accounts, include those also. Put the list in a safe place, such as a safety deposit box, and make sure they know how to access it when it is needed.
6. What insurance you have and where the policies are: If you or your wife become incapacitated, your children will need to know about your health insurance — private or Medicare. Also, provide info about your life insurance, auto, homeowners, disability and long-term-care policies, so they know your coverage and whom to contact to cancel.
7. Where your financial paperwork is: You’ll want to tell them where to find the title to your house and car, your property deed, and all loan documents.
8. Where your tax files are: Let them know where they can find your previous years’ returns.
9. How you envision your memorial service: This information is in your estate planning documents, but it doesn’t hurt to discuss what kind of funeral you have in mind, assuming you want one, and where you want to be buried or cremated. Tell them about any burial plots you have that they might not know about.
10. Whether you’re an organ donor: This is also in your incapacity planning documents (part of your estate planning), but again it is good to tell them your preferences in advance and let them know where you keep your organ-donor designation (on a driver’s license or if there’s an organ donor card.)
11. Where your safe-deposit box and key are located: The executor of your estate may be able to get into the box without a key, but it’ll probably involve a drill and a substantial fee. Save them the headache and let them know in advance where they can find the key!
12. Where other important passwords are located: Set up Keepass or Lastpass and keep all your passwords in one place. Share how they can access this file, when needed.

I hope your family meeting goes smoothly. If your family is experiencing conflict regarding your estate planning wishes, please read our article, “How to Minimize Family Conflict Over Your Estate Planning Wishes,” for tips on how to handle it.

Planning in Advance is Important!

If any of the members of your family have not done their estate planning or incapacity planning, or not had it reviewed and updated in the last five years, please contact us as soon as possible to make an appointment for a consultation:

Fairfax Estate Planning: 703-691-1888
Fredericksburg Estate Planning: 540-479-1435
Rockville Estate Planning: 301-519-8041
DC Estate Planning: 202-587-2797