This is our second article in a 5-part series on Building Healthy Family Finances

If the thought of talking about money makes you uncomfortable, you’re not alone.  Many Americans shy away from discussions about their personal finances for various reasons ranging from the desire to avoid tension or competition in professional and personal relationships, or simply wanting to retain privacy.  While it’s certainly understandable you’d want to keep details of your finances discreet, it’s also important to consider bringing your immediate family members into financial discussions which may impact their lives.

If you’ve been raised in a family where money matters are a taboo subject, it may seem that it’s best to continue doing things the way they’ve always been done.  One recent market-research survey conducted by the Spectrem Millionaire Corner Why Affluent Parents Clam Up About Their Incomes – The New York Times ( found that 18 percent of parents who make more than $100,000 per year never planned to disclose their income or net worth with their children.  Their reasoning?  According to 32 percent of the respondents, “It’s none of their business.”  While it’s a personal choice as to how much information you are comfortable sharing with your family, if you pass down a tradition of all financial discussions being off-limits, it can work against the goals you are trying to achieve.  

New lines of communication can be started over a casual dinner with something as simple as sharing the best piece of financial advice you’ve ever received.  Discussions can, and should, become a two-way street in learning from each other.  Whether speaking with young children, teens or adults, tailoring the topics accordingly will allow their financial acumen to grow as they learn from older family members.  The goal of the conversations is to share insight, guidance, and possible expectations of managing a family’s wealth.

Some Topics to Discuss

  • Money and Values. What is important to your family?  How has the family made money?  As parents and grandparents share their path to acquiring wealth, misguided assumptions younger generations may have can be cleared.  Adult children may have grown up in an affluent household and never been privy to why their family’s finances were above average.  Valuable lessons of financial planning and deliberate strategies used to achieve success can replace mystery or the belief they “just got lucky.”
  • The Definition of Financial Success.  This can be a highly personal answer.  For one person it may mean continuing the growth of a family-owned business, and for another it might mean the financial ability to retire comfortably.  The first step in achieving financial goals is to establish them.  Then comes the hard work of making decisions daily that bring you closer to your goals.  Sharing your family’s stories can be powerful.
  • Money Management.  No one is born knowing how to budget, save or invest money.  A basic financial education is vital to establishing and growing wealth.   What better way to enhance lessons already learned in school and business than to hear from family members about the way they have done these things successfully? 

Topics More Specific to Your Family’s Plans

  • Legacy Planning.  Older family members may have spent a lifetime building up a family business, preparing for the time when they can pass it down to their children or grandchildren.  Or they may have been deeply involved in philanthropy supporting causes or organizations with charitable missions.  By discussing the areas of focus which are important to them, older family members can share their vision for the works they would like to see continued in their name.
  • Caring for Elders.  As parents and grandparents age, their care needs will change.  Whether their intention is to remain independent and living in their own home or relocating to a community where assistance is more readily available, is there a plan in place to ensure that health care, legal and financial issues can be addressed while respecting their wishes?
  • Future Inheritance.  The thought of discussing a transfer of wealth, which may or may not be disbursed unevenly between heirs, may seem intimidating.  However, not only will this conversation allow further explanation if necessary, it can also help prepare heirs for the responsibilities and opportunities they may have in the future. 
  • Trusted Financial Professionals.  Some family members may already have a circle of trusted financial experts including a financial advisor, an accountant, and an estate planner.  Adult children or grandchildren may not have experience working with professionals who can help them to create and implement a plan for financial growth.  By sharing some of their experiences and explaining the value of working with a financial team, older family members can help younger members prepare for their future.  They may even want to share the resources of the specific team who helped them to grow and manage their wealth.   

Talking with your family about money doesn’t have to be stressful.  It may feel uncomfortable at first, but once a rapport has been established, the benefit of lessons and information shared between family members will likely be worth the effort.  If you would like more ideas on how to speak with your family about money, please contact us.