Trust, Transparency & Triumph: Talking About Your Family’s Future

Whether we having aging parents or are parents with adult children or both, we all should consider the opportunity to have an honest conversation about the future with our parents and/or our children. If there is one lesson that I have learned from the many families I have worked with over the years, it is that elderly parents often regret that they had not started an open dialogue with their adult children earlier in life. With 76 million American Baby Boomers moving into the retirement stage of their lives, there is a huge opportunity and need for families to start having these conversations today.

While these conversations cause all of us to come face to face with our own mortality and the possibility that health-related issues may result in a diminished capacity, the alternative of not having these conversations is that decisions will ultimately be made without an understanding of parental desires and often result in tension and misunderstanding among family members. One way to start these conversations is for parents to talk about their life journey. Often, as parents, we assume that our children know of the struggles we went through earlier in our lives. However, children are often unaware of decisions we made or why we made those decisions. By starting this dialogue, it helps to build up understanding. These conversations also provide an opportunity to discuss how the parents dealt with their own aging parents. This dialogue allows parents and children to walk into what might be appropriate going forward based on different scenarios.

Fear of unwanted or unanticipated change can make people of any generation nervous. To quell any anxiety, it’s helpful to take a partnership approach with family members – think how they might feel – and guide them through the prospects of change. This is not just an issue for the parents, it is also an issue for children. For example, do family members have certain assumptions about what role they or others will play? If these issues are not addressed before a crisis, they can often result in resentment among siblings or even tear a family apart, which no one wants.

[Watch: Creating a Safety Net For Your Family with Smart Legal & Financial Planning]

The most successful families that I have worked with focus on what I call “The Three T’s of Transparency, Trust and Triumph.” When families build Transparency and Trust, they typically will Triumph over the barriers that can arise when planning for big life changes. Conversations typically start by taking small, non-threatening steps in discussing what the future can look like for both the parents and their adult children.

Some tips on how to create Transparency and Trust:

Allay fears and maintain dignity. Adults wishing to help their elderly parents with their finances can start by offering to learn from them, and then gradually take care of regular bills on a monthly basis when necessary. Start the sentence with “Because,” as in “Because I believe you and I can work best together if we can share the information,” or “Because it will give me more peace of mind if I can help in case of emergency.”

Set aside sibling rivalry. Likewise, if parents are considering asking their adult children to serve as executors or trustees, they should think objectively about who has the personality to work well with the other siblings, and who has maturity to take on the responsibility. It may not be the eldest who can “play well with others.”

It’s best to have one executor, one health care proxy and one trustee to avoid gridlock in vital decisions that can involve a loved one’s care. Parents should discuss the team approach with all of their children and make sure that everyone is aware of their wishes and intentions. Encourage everyone (parents and children) to share their feelings. Take the opportunity to deal with any conflicts now, as later a parent may not be able to do anything about any unresolved conflicts due to diminished capacity.

[Related: Yours, Mine and Ours: An Estate Planner's Nightmare]

Don’t assume children will carry on the family business. Preparing for the next generation of a family business is an entire topic in itself, but if a family business is involved, it is even more important to create an open line of communication early. This is the key to preventing misunderstandings based on assumptions. It’s better to know the children’s interest or intentions upfront to avoid placing them under pressure to take on a role they do not want or are unprepared to fill.

Your business and employees deserve the best-prepared and most committed leader they can have; so it’s never too soon to start envisioning a succession planning process.

In sum, it’s an incredible gift for both parents and adult children to be part of a conversation while everyone can participate fully. By starting early, families have the chance to bridge misunderstandings, raise questions, and give people the chance to think about their answers over time.

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Susan Michel is founder and CEO of Glen Eagle, an award-winning financial services firm based in Kingston, NJ. Offering both advisory and broker dealer services, Glen Eagle takes an educational, holistic approach to meeting its clients’ long-term goals.