Talking about finances is one of the main causes of disputes between parents and adult children. According to a study conducted by Albers Communications Group for Home Instead senior care, 44% of Canadian lawyers surveyed agree that talking about money puts a strain on family relationships. In some severe cases, legal action is pursued between family members, especially when there is a family business involved.
Over the past 5 years, half of Canadian families have ended up in legal disputes over money and end-of-life issues, due to lack of communication. This calculation is quite shocking, given that 78.5% of adult children and 82% of aging parents, surveyed in the same study, say that they had clear and specific conversations about finances.
In order to avoid arguments, and save both children and parents from experiencing hurt feelings, family lawyers recommended doing the following:
Draft a Will and Share
Ensure that both parents and adult children sit down and discuss the details of a will, and have it properly executed by a lawyer. This encourages both parties to talk about certain types of property or belongings, clarifying who gets what. Also, this prevents surprises and possible arguments between adult siblings. As much as possible, aging parents should try to equitably divide property between all of their children and heirs.
Establish Powers of Attorney
When a parent ages, they may become unable to make certain decisions or care for themselves. To reduce stress during this phase, the parent(s) should execute powers of attorney well before. The designated individuals are then responsible for taking actions on behalf of the parent(s) who can no longer advocate for themselves. The attorney for property may also take care of the family property, any bills or taxes, bank accounts, and investments. The attorney for personal care may make life choice decisions.
Overall, it is highly important to discuss these matters early on, while parents are still independent and healthy, as these conversations may get complicated during later stages of their lives. The mentioned tips should be part of the conversations adult children have with their parents. As we get older, our parents do too, and to make sure they live the rest of their lives comfortably and free of stress, it is better to get the complicated – and sometimes awkward – conversations out of the way.
For more information on related topics, please contact DFS Private Wealth. We are here to help and answer any questions you have. Should you need a connection to a professional in your area we would be happy to make the introduction for you to someone you can trust. Contact Us today.