People do not like talking about money. They don’t like talking about their wealth or their money habits.
So, talking to elderly parents about money is usually a no-go area.
But having to talk to them about death AND money? We are going into ‘I would instead go into a tank full of starving sharks’ territory.
But there are several good reasons why you should, especially if you are a medical professional. You see, parents of medical professionals tend to be richer. They tend to have more wealth, too.
We live in a world of blended families with parents, new partners, children, stepchildren and ex-spouses. And as a generation, the elderly have more money than any previous elderly generation before them. In the old days, there was no point in anyone going to court when the inheritance in total was a rusty car, a couple rings and 4 potatoes in the kitchen.
Nowadays? Well, let’s say there are more than 4 potatoes available. More than 2 rings too. Probably about 20, and let’s not forget the $1m home. And from dealing with estate planning for many years, I can tell you when it comes to money and an estate, all kinds of people will pop up.
I once had a friend of a client who insisted that they were the rightful owner of a fountain pen (an exclusive and valuable item) as it was promised to them by my client. It was true my client had, but at the time, they were playing snooker, and my client had drowned approximately 2 bottles of whisky before that. Did he really mean it when he said it, or was it an off-the-cuff remark?
So, it is not surprising that many estates are disputed or go to court, which becomes a lawyer’s and accountant’s dream in terms of fees. And money that should remain in the family is usually lost. In fact, it is always lost.
If you have a will, most things can be covered. If you don’t have a will, then who gets what depends on the intestacy rules in your state. But the question I usually ask is, without a will, how does anyone really know what the person who died would have wanted?
Without a will, all kinds of people will come out of the woodwork asking for fountain pens, small gifts and sometimes larger gifts. But more importantly, it can stop family infighting.
But apart from money, there are a few other things. What if parents become frail? What if they lose the capacity to make decisions? Who looks after them physically and financially? We need to remember that although we live longer, we are so sicker and with ill health.
I have a client whose mother-in-law is in the early stages of dementia. His father-in-law just suffered a stroke, and one side of his body is paralysed. They are deeply private people, so no one really knows what their wishes are about their wealth. The in-laws have 3 children – two of whom have not been in touch for a few years.
And so, there is uncertainty about what should happen. What would they want? Who will undertake care? Is there even enough money for care?
And this is the reason you should avoid the tank full of starving sharks; sit down and have a chat instead. It will not be easy. It will not be straightforward. They may get upset. They may even argue. But I still believe the sharks would be more painful.
Estate planning is Step 9 of our 9-step process to working less hours, earning more income and building wealth. If you would like to know more, email Hitesh at hitesh@wowadvisors.com.au or Ros ros@wowadvisors.com.au or call 07 3161 9548.
