Starting difficult conversations with family can be really difficult, especially in the holiday season. It is understandable to want to make gatherings light-hearted and fun, but holiday gatherings are likely some of the few times that you see family. It is important to bring up a little bit of business while you’re together so that everyone is on the same page together.
 
Estate planning isn’t an easy topic to bring up, but it is an important one to talk about. Making sure that your family is all on the same page helps the transition process and also ensures that your family isn’t surprised at anything or anyone that is or isn’t included in your estate plan.
 

What is Estate Planning?

An estate plan is the process by which you ensure that your family and loved ones are taken care of after you pass. Your plan will also include what happens if you are incapacitated and unable to make decisions for yourself. To make a good plan, you need to include a few documents.

• Will
• Trust
• Power of Attorney
• Advanced Directives
• Life Insurance

What Conversations Do You Need to Have?

Use your intuition and let some of the conversations come up on their own and then direct them towards a helpful conversation of estate planning.
 

Medical

You need to know if any of your relatives have a medical power of attorney. If they do, it is also important to know if it is you or not. The communication between all of you should help decisions if anyone was to be in the situation where they can’t make decisions for themselves.
 

Responsibility

Knowing who is responsible for what in your estate plan is important so you can inform those that play a role. It is also important to know if you will have a responsibility in someone else’s estate plan, such as a parent or sibling, so you are prepared when they pass. Here are a few responsibilities that may be imparted on you:

• Personal Representative (PR)
  • The term personal representative is the same as saying an executor. The executor is in charge of carrying out the terms of the will or trust and will act on behalf of the deceased.
• Guardian
  • Children will have to have a legal guardian and most people would prefer the children under their care go to someone they know. A guardian is also needed for the elderly. If they cannot take care of themselves, then they will need someone to take care of them and act on their behalf.
• Financial Power of Attorney
  • Financial power of attorney will help if you are incapacitated and aren’t able to handle your own finances. Oftentimes, parents will name their children as a financial power of attorney.
• Medical Power of Attorney
  • If someone is ever unable to make decisions on their own, having a medical power of attorney will put someone in charge of making your medical decisions. If someone is in a coma, having someone able to make important decisions for them helps the situation.
• Advanced Medical Directive
  • Think of this as a living will. It is important to know if your relatives have one that you are named in.

Insurance

If you have life insurance, or some of your family does, it’s important to know who the beneficiaries are and make sure all of those names are updated.
 

Estate

You don’t want to be surprised about who gets what out of a relative’s estate. Having the conversation and knowing how assets will be divided before an estate is divided can help ease a lot of fighting down the road.
 

A Case Study: What Happens When You Don’t Talk About Your Estate

Kevin has enough money in his budget to care for certain family members and takes special care of his grandmother. Kevin is also in a relatively large family with 3 other siblings. His grandmother has a home that all of the children grew up in together. The house is also gaining property value as it’s in an up-and-coming neighborhood.
 
While eating dinner a few nights ago, Kevin’s sister mentioned that she didn’t know if she wanted to sell the house after their grandmother passes because of its personal value to her. Kevin was surprised to hear this because he had been paying the mortgage and it’s even in his name. The grandmother had not told any of the siblings that the mortgage is in Kevin’s name, and she wishes to keep it that way so the siblings don’t fight.
 
By not revealing that information the siblings believe that they will have equal say as to what happens to the house after their grandmother’s death. The conversation will be very uncomfortable if it is done after the grandmother dies because it will come across as a secret deliberately hidden from the rest of the family.
 

How to Start the Conversation

Start talking to your family now. Whenever someone dies they shouldn’t be surprised as to what happens next.

1. Let the conversations make themselves and don’t force anything
2. Reference past conversations or articles that you’ve read

Bring up your financial planner