Family Money and Estate Planning Meetings

If your heirs will receive your assets from your trust directly or perhaps paid into separate trusts for them created by your trust, when should they know about some of the details of your financial and legal affairs?  I raise this question because of an experience last year with a family of four adult inheritors, children of the trust grantors, who learned about their parents’ affairs from their lawyer the week their last parent died.  None of them knew the size of their parents’ estate ($2m) nor were they knowledgeable about investments or trusts.  Over the course of more than a year they struggled and dealt with the obligations of learning how to handle investments and deal with their newly created trusts.

My partner and I discussed this situation several times and decided that families with enough assets to need investment advisers and estate planning attorneys should make an attempt to educate their heirs as soon as they have the courage to do so and not leave it to a stranger to educate them as they mourn the loss of their parents.

We designed a “Family Money Meeting” with the intent of opening dialogue between parents and their adult children about the scope of their financial and legal affairs, and educating the younger generation about the workings and responsibilities of managing investments and dealing with trusts and lawyers.  This meeting lasted five hours including lunch.  All attendees seemed engaged and candid.  The youngsters had a chance to raise  questions about the parents’ affairs and how they would receive their inheritance and hear the answers.  They also learned about investment management and the use of trusts.  I believe that having an inter generational family money meeting can go a long way in preventing frustration and family conflict that avoiding such discussions can create.

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