“What would my parents have wanted?”
Those six words capture the emotional chaos that can follow a parent’s passing. Many retirees avoid discussing their financial plans, estate wishes, and care preferences with their adult children. Maybe it feels too private. Maybe there is a feeling it will create tension. But keeping them in the dark often leads to far greater stress—for everyone.
Financial planners see both sides: The families who took the time to talk—providing stability through a period of grief—and the families who didn’t—and left their children navigating uncertainty, conflict, and avoidable mistakes. Involving your children in your planning isn’t just practical—it’s one of the most powerful ways to protect your legacy and give your loved ones the clarity they’ll need when it matters most.
Navigate Complex Financial Situations with Greater Clarity
Looping in your adult children becomes especially important when your financial plan includes more complex or emotionally sensitive elements. These are scenarios where misunderstanding—or poor timing—can result in unnecessary taxes, missed opportunities, or even fractured relationships. A few key examples:
- Large pre-tax retirement accounts: Under current IRS rules, most non-spouse heirs must fully withdraw inherited IRA or 401(k) funds within 10 years. If your adult children are in their peak earning years, this can trigger a significant tax spike—pushing them into higher brackets just when they’re already highly taxed. Having conversations in advance can allow for strategies like Roth conversions or gifting to be considered now.
- Family trusts: If a trust will be managing your assets, your children need to understand who the trustees are, how distributions work, and what their responsibilities or limitations might be. Involving them avoids confusion and builds accountability across generations.
- Sentimental real estate: Whether it’s the family vacation home or the house you raised them in, real estate often carries emotional weight. Discussing whether they want to keep, sell, or rent out the property—and how that will work logistically—can prevent resentment or rushed decisions.
- Business succession planning: If you own a business, conversations around whether children are involved, want to be involved, or will inherit a share are absolutely essential. Failing to address this can create fractured ownership, legal disputes, or forced sales. Engaging them now lets you align expectations and successors while you’re still active and available to guide the process.
- Blended families or unique family dynamics: When stepchildren, second marriages, or estranged relatives are involved, assumptions can turn into serious issues. Clarifying your intentions and communicating them transparently reduces the risk of conflict—and potential litigation.
- Health and long-term care planning: Health events often happen without warning. Sharing your directives, powers of attorney, and care preferences gives your children the confidence to act quickly. A study by BMJ concludes that “Advance care planning improves end of life care and patient and family satisfaction and reduces stress, anxiety, and depression in surviving relatives.”
In all of these cases, early communication allows your advisor or estate attorney to design a plan that reflects your goals, avoids unintended consequences, and ensures your family is set up for success—not confusion.
How to Start the Conversation
These steps, grounded in best practices, can help make the conversation smoother and more meaningful:
- Prepare First: Review and update your key documents—wills, trusts, powers of attorney—and organize account information, advisor contacts, and login details. Doing this first helps you feel more confident going into the conversation with your children.
- Pick the Right Time: Choose a calm, low-stress moment—ideally when everyone is relaxed and receptive. It doesn’t have to be a major event; sometimes a quiet visit, a casual Sunday lunch, or a phone call with a clear intention works best. The goal is to create space for a meaningful, uninterrupted conversation without the weight of celebration or crisis.
- Break It Into Sessions: If possible, divide the conversation into a few focused discussions—one on legacy wishes, another on health care preferences, and another on financial logistics. This can reduce overwhelm and improve clarity. But if your children live far away or time together is limited, one thoughtful conversation when everyone’s present can still go a long way. Just be mindful to read the room—if emotions run high or timing feels off, it’s okay to pause and revisit the discussion later. The key is to be intentional—whether it’s one session or several.
- Introduce Them to Your Advisor: Introducing your children to your advisor builds trust and familiarity. It gives them a chance to ask questions, understand your goals, and connect with a trusted resource they as they begin their own planning. When there’s already rapport between your children and your advisor, any future transition—especially after a parent’s passing—becomes far more comfortable. They’ll be speaking with someone they know and trust, not a stranger, during a difficult time. Your advisor will be happy to help the next generation, whether they’re just starting out, saving for a home, or building financial success. It’s a meaningful way to pass on a trusted relationship and create a smoother transition when life changes occur.
- Be Clear and Specific: Let them know where important documents are stored, what your wishes are, and who is responsible for what. This reduces uncertainty and ensures everyone is aligned.
- Set Boundaries and Expectations: Whether or not you plan to offer financial support, make it known. This helps prevent confusion, resentment, or unrealistic assumptions—especially under stress.
The Bigger Picture
Involving your adult children in your financial planning is more than a transfer of information—it’s a powerful way to create peace of mind. It prevents surprises, strengthens family bonds, improves tax outcomes, and prepares your loved ones for both the expected and the unexpected.
Warren Buffett once said that reviewing your will with your children before signing it is one of the best ways to ensure your wishes are understood and honored. I couldn’t agree more.
This article was written in collaboration with my colleague Nolan Lewis, CFP®
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