Forming an estate plan may seem like an end-of-life task, as well as a private one. When money, assets, and inheritance are involved, some see this as a personal responsibility. Because of this, it shouldn’t be any surprise that many parents don’t take the time to sit down with their children to talk over the specifics of what it means to plan an estate or will, let alone involve them in their own process of estate planning.
In reality, talking to your children about estate planning can actually be one of the best ways to teach them valuable life lessons, like saving, planning, and being able to navigate inheritance and estates later in life. Not only can you walk them through your own estate plan and how they will claim and inherit your estate, but you can give them the tools they need to understand how the system works when the time comes for them to plan their own estates and wills.
Why You Should Teach Your Children About Estate Planning
The more information your children know, the more details they can use in the event of your passing to secure their inheritance in a timely and safe manner. The last thing any child wants is to be dealing with the grief of a parenting passing, only to realize that they were unknowingly or even unwillingly named as the power of attorney.
By teaching your children about the process while planning your own estate, you can actively educate your children on the basic steps of writing a will, what a divorce means for an estate, and other issues. You can even help them understand the more complex matters that involve creating a trust and choosing beneficiaries. It is also a vital step in educating them about any of the responsibilities they may have if they are appointed as the executor of your estate.
By taking the time to go over your estate plan together, you can explain any critical roles and important details they will need to know to both secure their inheritance, as well as enforce that your wishes are met. When it comes time for your children to make these decisions for themselves, they’ll have the knowledge of how it is done and be familiar with the financial tools and terminology like trusts, trustees, beneficiaries, and other important information.
When Is the Best Age to Begin Teaching My Children About Estate Planning?
While it can be difficult to talk to your children about such complex issues, it is helpful to discuss any information pertinent to your child as they grow into an adult. This can start with letting your young children know that if something were to happen to them, you have a plan to keep them safe and make sure they have a good life. As they approach a more responsible age, you might want to let them know about any fireproof boxes or important documents they would need if something were ever to happen to you, as well as the importance of writing a will and how planning an estate works. As children reach their teens, they can understand more about the financial aspects of estate planning and their eventual roles will be.
What Is the Best Way to Educate Your Child About Estate Planning and Responsibility?
Many parents hesitate to discuss estate planning with their children out of the fear it will cause their children to poorly manage their own money due to entitlement regarding their upcoming inheritance. There are sadly even statistics that suggest that 90% of inherited wealth and property is wasted on spending sprees or lost due to carelessness.
That’s why as you educate your child on your estate plan and will, it’s important to also teach them to be a good steward of their own money. It is important to remind them that their inheritance is not an end-all fortune but instead something to assist them on their own financial journey and to support their dreams and future family.
Be sure to also take steps in these discussions to help them plan their future finances by helping educate them about the importance of hard work, savings, and even giving back and helping others with funds.
Q: At What Age Do Most People Start Planning Their Estate?
A: Typically, the latest you will want to begin planning your estate is in your forties, though many actually begin the process much earlier. Remember that by educating your children about the steps they need to take when planning their estate, you can help them get a jump start on their own future.
Q: Should I Discuss the Financial Implications of My Estate with My Kids?
A: Depending on their age and maturity, it’s usually best to be open about your finances. It can be helpful for your children to be aware of assets or money they are set to receive, though be sure to remind them that through taxation and other factors, that number could change.
Q: How Should I Bring Up the Matter of Estate Planning When Teaching My Child?
A: You can use an anecdote about how your parents handled their estate planning, ask them a question about their thoughts on finances, or simply let them know estate planning is something you’d like to discuss. Consider bringing your older children with you to discuss estate planning with your attorney.
Q: What Is the Average Inheritance Received by a Child in the U.S.?
A: The Survey of Consumer Finances has stated that the average inheritance of a child is roughly $46,200.
Contact an Experienced Estate Planning Attorney
By teaching your children about estate planning, you can set them up for a more successful future. Whether your children are ready to learn more about wills and estate planning or you just need to learn more about the next steps, Stange Law Firm can help. Trust our Kansas City estate law attorneys to help you and your children secure an estate plate that will protect your finances and their future. Contact us today for a consultation.