Financial success brings its own set of challenges to family life and parenting. Time and again as we work with our clients in planning for wealth transition we find the most common barrier to solid planning is the lack of clear, comfortable communication around money topics. Parents worry that their kids may lack the skills and money sense to manage significant wealth, either while they are alive or after they are gone. And worry they should if they aren’t being intentional about passing on their money beliefs and values. After all, you can’t take it with you and you can’t leave it to the dog!
Three steps to get you started:
- The Internal Talk – Spend some time alone or with your spouse exploring why you find it hard to talk about money. Did your parents talk to you about money? Did they fight about money? What feelings and values did they pass on to you concerning money? What is the danger of not talking to your kids about money? What are the risks involved if you do talk to them about money? What about the benefits?
- The Introductory Talk – Over an informal lunch, dinner or coffee, let your child or children know that it’s important to you for all of you to begin to communicate more about how money works in the world and in your family. If you feel a bit uncomfortable about it, that’s fine, you can even tell them that it’s going to be a new experience for all of you, including yourself, and that you’ll be figuring it out as you go. Invite them to start thinking of money topics they’d like to learn more about for your first family money talk.
- The Family Meeting – Set a day and time for meeting to talk specifically about money. You want this to go well so spend some time preparing for the meeting. Remember that preparing has as much to do with preparing yourself to listen as it does preparing what you’re going to say. If you show that you’re really interested in what your kids have to say, chances are, they’ll engage in what you’re trying to tell them too. Use active listening strategies and teach your family members to use them too. Below are some suggested strategies:
- Suspend other activities
- Notice feeling and content
- Let them finish
- Process what you heard
- Restate what you heard
- Ask questions
- Beware of your opinions
- State your thoughts, after they are done speaking
Take some cues from the kids even if their ideas seem naïve or off-base at first. The key at this stage is to get them onboard and interested. Take notes and follow through on finding answers to their questions that arise. If you’re having trouble getting buy-in from your spouse, begin anyway. Improved communication skills in a couple of family members have a sneaky way of improving communication all around. Decide as a family how often you want to meet and pick the date for the next meeting. And remember to have fun with this so you’ll all look forward to the next one.
Overcoming your family’s taboo regarding talking about money may seem like a big deal starting out. The reality is that the taboo is just an idea in your head which you have the power to change at any time. How about now?