Talking About Wealth; Navigating Communication with Heirs
Most people with wealth to pass on have never talked to their heirs about how they plan to distribute their assets after they die because they consider the information too personal, according to a recent survey. In six out of 10 families, there is no process in place to ensure family wealth decisions are made and communicated effectively (from another survey).
This is actually no surprise, because these sorts of discussions are among the most difficult. They evoke feelings of mortality in the incumbent generation. And because our relationship with money is primarily emotional, talking about money produces subconscious reactions in those participating in those discussions.
These reactions are usually driven by fear and most people will need help to understand their emotional drivers. Understanding our attitudes to money is therefore a prerequisite to having a healthy family communication framework.
In the absence of communication, family members fill in the gaps by guesswork, or what they can find out online, both of which are usually wrong which leads to assumptions. Open communication helps children learn about wealth and values, while enabling the family to comfortably navigate difficult money talks.
By creating a family mission and vision statement first, discussions about money can be suitably contextualised and be less about the numbers, and more about the underlying purpose and meaning to their lives.
Consider This: What have you told your children about the family wealth? What do you think they have discovered without you telling them anything? At what age do you consider it appropriate to start preparing them to be good custodians of family wealth? Are they are aware of all the things money can’t buy?
- To Successfully Pass Down Your Wealth, First Share Your Intent
- Most heirs left in the dark about estate plans
- How, Why Generations Should Discuss Wealth Transfer
- Australians need to discuss their will with children
- How Being Too Guarded Can Prevent Your Family From Achieving Its Mission
- Tips on talking to the next generation about your family’s wealth
Here is more on reading on transfer wealth to children.