{"id":6168,"date":"2021-04-30T12:26:54","date_gmt":"2021-04-30T12:26:54","guid":{"rendered":"https:\/\/emoneyadvisor.com\/?post_type=thought_leadership&p=6168"},"modified":"2021-08-25T00:51:41","modified_gmt":"2021-08-25T00:51:41","slug":"talking-about-money","status":"publish","type":"thought_leadership","link":"https:\/\/emoneyadvisor.com\/blog\/talking-about-money\/","title":{"rendered":"Talking About Money"},"content":{"rendered":"

Talking about money is difficult no matter who’s participating in the conversation, but it can be especially challenging when family is involved. Financial professionals should encourage clients to share their financial lives with their children and other impacted family members, despite any difficulty surrounding these conversations. The benefits of talking about money far outweigh the discomfort and potential consequences of not talking about it.<\/p>\n

The nature of the information, and when it should be shared, depends on the age of the clients, as well as their children, but the earlier in their lives it starts, the easier those conversations will be as all parties grow older and the financial implications become more complex.<\/p>\n

Earlier Is Better<\/h2>\n

The advantages children see from talking about money at an early age are two-fold. It teaches them the routine basics of handling money while also setting them up to better understand more complex monetary instruments and decisions as they get older. Early topics could include budgeting, debt, and other more elementary financial literacy topics and money values.<\/p>\n

Introducing the concept of long-term financial planning to your clients’ children should supplement these conversations about money. Young children don’t need to know the intricate details of your client’s financial plan\u2014but understanding that there is a plan and that their parents have goals sets the stage for more in-depth conversations as they age.<\/p>\n

Evolving to the Teen Years<\/h2>\n

As kids get older, help your client increase the sophistication of the financial conversations. When teenagers get their first job and open their own bank accounts, it’s important they continue to manage their money as they’ve been taught. Make your clients aware of tools and technology that teach kids how to effectively manage their own accounts and goals.<\/p>\n

Invite your clients to include their older children in annual plan reviews. If the client’s plan includes saving for college or other goals related to their future, loop the child in on the discussion. Seeing the effort the parent is making will help the child appreciate and understand how to make the most of the funds allocated for higher education and other aspirations.<\/p>\n

Staying in Touch with Adult Children<\/h2>\n

There will come a point when a client’s children will be out on their own, perhaps with their own families. Work with your client to devise a plan to provide periodic updates that continue to include them in the conversation.<\/p>\n

They may be busy with families of their own and engrossed in the day-to-day aspects of their own lives, but keeping them in the know about their parents’ finances will help to lead naturally into the more difficult end-of-life conversations that will eventually happen.<\/p>\n

And when it’s time to focus on those more difficult conversations, financial professionals can help their clients by providing a meeting plan to follow to ensure they cover all the subjects they want to discuss.<\/p>\n

Provide Guidance for Family Financial Meetings<\/h2>\n

As clients age and begin to think about wealth transfer and end-of-life decisions, a new element of difficulty enters the discussion. No one wants to think about a time when parents die, but there are real consequences for lack of preparation. Not only could it cause stress and make extra work for families, but an incomplete plan could also result in the courts controlling how assets are divided.<\/p>\n

Lend your expertise as a financial professional to help your clients plan a family meeting or offer to facilitate one for them. Giving such a meeting structure ensures all necessary topics will be covered and increases its chances for success.<\/p>\n

The planning and execution flow could look something like this:<\/p>\n