Talking About Money- Why It’s Important & What To Cover
Jenny and William have 3 adult children. Her sons Carl and Gary live close by and her daughter Nancy will be coming home from Ottawa for a visit next week. Jenny has suggested to her husband William that they sit down with all 3 kids while Nancy is home, to talk about their financial situation and future. William brushes her off, saying that it is not necessary and everything is under control.
Talking about finances can be difficult, and many people, like William, would prefer to avoid such conversations altogether for a variety of reasons.
- We have money, property and papers scattered everywhere…I don’t even know where to start.
- We’ve already worked things out with our attorney.
- We don’t want to feel pressured by our friends/ family to make decisions.
- We are very private; we didn’t talk about our finances when we were young, and we don’t want to open up now.
- Our children have their own life to deal with; they don’t have time for this.
- We’re lousy with money. Besides I’m pretty sure my sister will handle this.
A lack of communication and planning can be costly to your family or friends. The best way to prevent financial challenges is to make a plan when you are physically healthy and still living in your home. It is much easier to plan ahead, than to react to a sudden event or crisis that forces you (or someone else) to make decisions quickly.
At the end of the day, what is really at stake is the opportunity for you to communicate your financial wishes, and get help to make those wishes come true. By communicating your wishes early on, you are:
- Making it easier for your friends and family to help you with financial issues in the future.
- Making sure everyone understands your wishes and desires, eliminating confusion.
- Creating a support network with whom you can talk to about concerns, ask questions, or get advice from.
When you think about initiating a conversation make a list of what topics you do and do not want to cover. Don’t feel obligated to discuss all information if you are not comfortable doing so. If at anytime you are feeling pressured, confused, or uncomfortable, ask to resume the conversation at a later date.
Things to cover in a financial conversation may include:
- Money – income, savings, investments
- Property – assets
- Liabilities – debts
- Housing – cost of living
- Health Care – cost of private care
- Legacy – gifts, bequests
- Legal Documents – power of attorney, will
Financial conversations of this type are important regardless of age. People should always ensure at least one person is aware of their financial situation and their wishes in the event of a major and sudden event which would dictate the need for someone to make decisions on their behalf.
For more information on having a conversation about money visit: www.ItsYourRight.ca