This is great advice from Erin Lowry, author of Broke Millennial, Broke Millennial Takes On Investing and the forthcoming Broke Millennial Talks Money: Scripts, Stories, And Advice To Navigate Awkward Financial Conversations.
With millennials ageing into their 40s it means many of your parents are now baby boomers and now is the time for that estate planning discussion which goes far beyond wills and inheritance.
Think beyond designating who receives what assets and how to settle any debts. An estate plan also includes details about who would make decisions should a parent become incapacitated.
Making these decisions now will allow you to focus on care, knowing the critical choices have been made. In fact, without an estate plan, the courts may need to step in if the child is at a loss about what a parent would want.
Just Having a Will Is Not Enough
Wills are important for settling an estate if your parents die, but other documents need to be in order while they are alive such as:
- Power of attorney
- Healthcare proxy
- A living will
These documents, part of an estate plan, are key because they designate a person to do things such as pay bills and handle other financial transactions as well as make medical decisions. All of this should be decided and in place before there is an issue or need.
To be fully prepared, again so you can focus on their care, make sure you know where the information is kept. Not just the estate plan, but a master document with passwords, auto-pay information, etc.
How to Start the Conversation
Author Erin Lowry recommends different ways to broach what can be a difficult conversation with your folks … “It is not easy raising this topic with a loved one…positioning the idea of setting up an estate plan as a way to alleviate anxiety and stress for you, the child, may encourage a still living parent to engage with you and get the paperwork handled”. Another tactic you might try is to take the route of asking for advice, for example "Since getting married, Joe and I are working on our estate plans. How did you two decide who would be the power of attorney and health care proxy?" Of course, there is always the direct route, especially if there is a family history of illness… "I'm concerned about our family history of dementia. I want to ensure we have all the legal documents ready, so if anything were to ever come up, we could immediately focus on your care instead of worrying about the legal and financial paperwork."
Last but not least, according to Lowry, is to position yourself as a helper and not try to bulldoze your parents. Bottom line, if they refuse to talk about estate planning, there is not much you can do.
Remember: “An ounce of prevention is worth a pound of cure.” When making your estate plans or when probating an estate or administering a trust, do not go it alone. Be sure to engage a Cincinnati estate planning attorney.
For more information about estate planning, probate or trust administration in Cincinnati (and throughout the rest of Southwest Ohio) and to review free resources regarding estate planning, probate or trust administration, visit my website. If you have questions regarding this article or a particular legal matter, feel free to contact me at 513-399-PLAN (7526).
Reference: Bloomberg.com By Erin Lowry December 30, 2020, Erin Lowry is the author of Broke Millennial, Broke Millennial Takes On Investing and the forthcoming Broke Millennial Talks Money: Scripts, Stories, And Advice To Navigate Awkward Financial Conversations