Reveal Your Financial Plans During a Family Meeting
By Mark Yatros
Imagine spending a lifetime building a successful career, investing, and acquiring assets. Now, take a moment to consider what would happen to all of this if unforeseen circumstances were to arise. That's where estate planning steps in, as a vital safeguard to protect your family's well-being and ensure your legacy lives just as you envision.
Estate planning is not just for the wealthy or elderly; it's a crucial process for everyone, regardless of age, marital or financial status. This is why my colleagues and I at Allegiant Wealth Strategies introduced the Family Love Letter to our clients. The Family Love Letter guides you through gathering your essential financial information and final wishes. Then, the information is ready for your survivors should something unexpected happen. If you haven't completed a Family Love Letter, you can download a checklist of what to include.
Once you have an estate plan and have gathered all the necessary information through the Family Love Letter or the checklist, you should tell your family about your plans during a family meeting. Holding a family meeting allows you to tell everyone at once about your estate plan, your wishes, and your intentions. It will also let you explain your decisions which will reduce hurt feelings and possible conflict among your survivors after you're gone, ensuring a smoother process for your family when the time comes.
Advantages of holding a family meeting
Getting the family together to review your estate plan might seem unnecessary, but it's essential. By involving your loved ones in the process, you give them a chance to understand your wishes and intentions firsthand. It creates an open space for discussions, questions, and concerns, allowing everyone to be on the same page. Moreover, this involvement can foster stronger bonds among family members, knowing you've all come together to safeguard each other's future.
Before we move on to the details of your family meeting, there are two important terms to define: power of attorney and trusted contact.
The importance of power of attorney
A power of attorney (POA) is a legal document that lets you appoint someone you trust to make crucial decisions on your behalf in specific situations if you cannot make decisions yourself. Your POA agent can manage your financial matters, make healthcare choices, handle property transactions, and even conduct your legal affairs. The person you designate as your POA should be someone who understands your values and priorities so everyone trusts them to act in your best interest.
It's vital to appoint a power of attorney while you're still competent because it will enable them to act immediately, if necessary. For example, suppose you become incapacitated due to illness or accident. In that case, your POA agent can seamlessly step in to manage your affairs without requiring court intervention. This can save your family precious time, money, and emotional strain.
The special role of trusted contact
Your trusted contact (TC) is someone you designate as an alternate contact with your financial advisor so your advisor can tell them about your financial matters and accounts. Consider your TC a watchful guardian who can protect you if needed.
Trusted Contacts must be at least 18 and can be a friend, family member, or someone you have a professional relationship with, such as an attorney or accountant. You could also designate your power of attorney, co-trustee, or another account owner as a trusted contact.
Your financial advisor can communicate with your trusted contact to address possible financial exploitation. Your advisor can confirm specifics about your contact information and health status and identify any legal guardian, executor, trustee, or holder of power of attorney. One key takeaway is that your trusted contact cannot make financial decisions or transactions for you.
It's important to differentiate between a power of attorney and a trusted contact since they serve different functions in your estate plan. Still, together, they form a solid support system for your future and well-being. They should also be at your family meeting.
Organizing your family meeting
Planning a family meeting about your estate plan starts with finding the right time and place for everyone to gather. Choose a time when all key family members can be present and free from distractions. As for the location, opt for a comfortable and familiar setting where everyone feels at ease. The goal is to create an environment where open discussions can occur without pressure.
Typically, family meetings include immediate family members, such as spouses, children, and siblings. You may also want to include other close relatives or trusted friends, depending on your circumstances. Ensure that all your advisors, like your financial planner, attorney, power of attorney agent, and trusted contact, are there. The more relevant voices involved, the better the outcome of your meeting.
To make your family meeting productive, gather and organize all the essential documents related to your estate plan. This may include copies of your will, living will, power of attorney documents, healthcare directives, insurance policies, and a list of your assets and liabilities. You do not need to share details of your finances if you don't want to. But providing an overall picture will be helpful to your heirs.
I suggest sharing a copy of your Family Love Letter as it succinctly provides a complete list of your accounts, advisors, assets, liabilities, and final wishes. If you haven't completed a Family Love Letter, you can download a checklist of what to include. You could also read my blog, “Prepare Today for Tomorrow’s Unthinkable,” for a guide to organizing your financial documents.
Having your Family Love Letter and other documents readily available will help facilitate discussions and clarify your wishes. Consider providing copies or digital access to these documents to key participants so that they can review them before the meeting.
Holding your family meeting
Establishing a clear agenda for your family meeting will keep the discussion focused, ensure all relevant topics are covered, and everything is understood.
Start with a brief introduction to the purpose of the meeting and its importance. Then, introduce your professional team, such as your attorney, financial advisor, POA agent, and trusted contact. You, or your attorney, should explain everyone's purpose, role, and responsibilities.
Then, address each aspect of your estate plan, such as whom you've appointed as a power of attorney, chosen as your trusted contact, and outlining your wishes for asset distribution. Now, take your family through your estate plan, explaining legal documents such as wills and trusts.
During your family meeting, you will explain how you plan to distribute your assets and the reasons behind your decisions. If you possess assets that require special handling, such as your home, family business, or heirlooms, make sure to highlight this for your family. If you are making charitable bequests, describe them to your family.
During the meeting, tell your family about your final wishes and desires for your funeral or memorial service. This is the time to make sure they know what you want your last days to be like, in case you can't tell them later.
Allocate time for questions and discussions and encourage everyone to express their thoughts and concerns.
Holding a family meeting about your estate plan ensures your legacy. This meeting provides an opportunity to safeguard your family's future, fortify your bonds, and imprint a lasting legacy that embodies your values and love for your loved ones.
Remember to download the Family Love Letter Checklist, so you'll know everything to gather before your family meeting!
If you’d like further guidance on your estate plan or the Family Love Letter, we’d be happy to help. You can schedule a free consultation with Allegiant Wealth Strategies’ team of experienced financial advisors here.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to ensure our information is accurate and useful, we recommend that you consult a tax preparer, professional tax advisor, or lawyer.
Allegiant Wealth Strategies offers securities and advisory services through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. Allegiant Wealth Strategies has offices in Battle Creek and Portage, Michigan, from which we serve Calhoun County, Kalamazoo County, and Kent County (Grand Rapids). The Allegiant Wealth Strategies team offers no-obligation financial planning consultations; call 269-218-2100 or contact us here.