Financial planning isn’t just about numbers. Because your financial plan likely affects your family, there are personal relationships to consider.
Discord over finances is common for many families, and some pay dearly for it. It’s such a serious consideration that one organization, the National Family Business Council, specializes in helping families resolve the family issues affecting their ability to develop successful wealth planning strategies.
You don’t have to be wealthy to be affected. Helping aging parents manage their financial lives, for example, affects almost everyone at some point. And when it does, family dynamics and legal issues can make even the simplest tasks challenging. For example, you may rely on your siblings for assistance, only to find out that they aren’t equipped with the necessary skills or the willingness to help care for your parents.
It’s a good idea to determine now if you think you might be in such a situation. Keep an eye out for signs of financial stress in your parents. Ask how they’re doing.
Then, if you think your parents may reach the point at which they will struggle with their financial affairs, increase your family communication. Doing so now will help you avoid problems later.
Family meetings are an effective way to facilitate family communication. It’s usually best if your parents call the first meeting, but they may be reluctant to seek help. As you plan the family meeting, think about what you’ll want to cover. A good start is a summary of your parents’ current income, expenses, savings accounts, beneficiaries, and health.