4 Steps for a Successful Estate Planning Talk with Your Family

by | May 12, 2022 | Estate & Legacy Planning, Insights

Jim and Debra are all about family. At age 65, they recently retired and moved across the country to be closer to their three children and four grandchildren. Most weekends are now filled with family barbeques and games at their new lake house. As we discussed their legacy and estate plans, they grew concerned, worried about how a potentially large inheritance would impact these next generations of their family.

“We don’t want to ruin the kids and grandkids with our money. We want to take care of them, but make sure they understand the value of hard work. We want to pass on our values and lessons learned, not just our wealth…how do we talk with them about this?”

Does this sound familiar? If so, you’re in good company. Many of our clients worry about how to effectively pass wealth and values to their family. And rightfully so…it’s an important topic! A recent survey revealed that 70% of families lose their wealth by the next generation, with 90% losing it by the third generation. Though you have dreams of the impact your wealth can make, communicating your values effectively is easier said than done. 


Prepare your wealth for your family AND your family for your wealth

If you’re like many of our clients, the first thoughts about passing wealth to family turn toward wills and trusts, tools to help avoid tax and legal surprises at your passing. For more, read How to Reduce Estate Taxes. We think of this “estate planning” as preparing your wealth for your family.

But is your family prepared for your wealth?

This brings in values and legacy, the heart-centered side of the equation. How do you hope your family uses your wealth? What lessons do you hope to pass on? We think of this “legacy planning” as preparing your family for your wealth.

So how can you ensure the entire equation is solved, both estate and legacy?

The set of wills and trusts you choose to pass on your wealth, also known as your written estate plan, takes care of your assets. The strategies can be complicated, and you will need to prepare trustees, guardians, and other important roles on what will be required of them. However, once decisions are made and documents are signed, your wealth is ready for your family.

But beyond the legal work, it’s important to remember that family legacies are built on relationships. Conversations about your values and vision help to prepare your family for your wealth. So how can you start healthy dialogue with our family about the legacy you want to leave?


4 steps to a healthy legacy planning discussion

Step One – Define what you want

Before diving in with your family, are you ready for these discussions? For many, this is the hardest part. But it can help to ask yourself these three questions to help define what you want:

  1. What is important to me? How do you hope your family uses the wealth you pass on? Educating future generations? Supporting specific charities? Carrying on a family business? Be ready to describe each goal and why it’s important to you.
  2. Am I ready to invest time and energy? You’re here to share your values, lessons, and goals and why they are important to you. These vulnerable conversations take time, so make sure you’re emotionally prepared and ready to invest the time and effort needed.
  3. Am I ready to answer questions? Once you share your values and vision, your family may have questions, even resistance. Helping them understand your goals often comes through extended dialogue.

With your goals defined, you’re ready to open the discussion!

Step Two – Cast your legacy vision

Gather your family to start a discussion about the long-term impact you hope to have with your wealth. Consider grouping goals into three categories:

  • Enjoy life. What’s on our bucket list? What kinds of experiences do we want our family to have?
  • Provide for loved ones. What opportunities do we want to provide to future generations? What stories and lessons do we want to pass to our kids, grandkids or great grandkids?
  • Impact causes we care about. What charities have we been involved with? Which have been the most meaningful to us? Where have we seen the most impact?

Your legacy vision is your “why” – the motivation to think about the future. You’re likely to encounter questions, discussion, and perhaps even some pushback. Though it can be difficult, this can foster valuable growth as you talk together about what your family stands for and the impact you want to make.

Step three – Walk through your estate plan

With your legacy vision laid out, you’re primed to walk your family through the tools and strategies you’ve implemented to bring your plans to life. Our clients often include us in this discussion to help explain complex tax and legal strategies in simple terms. You may have several important points to make, but consider including at least the following:

  • Tools. Explain wills and trusts you’ve implemented so that everyone involved understands the strategies you’ve selected and why. If you’ve set up an educational trust, for example, tie it back to your “provide for loved ones” vision so they can see your legacy come to life. We encounter many second and third generations with complicated trusts who feel like their parents didn’t trust them and chose to place restrictions on their wealth instead.
  • Roles. Explain who does what. Introduce your professional team of attorneys, accountants, and financial advisors. If members of the family are trustees, it’s a great time to explain why you chose them as a way to celebrate the way they’ve agreed to serve the family. This prevents surprises down the road and makes it crystal clear who is responsible when you pass.
  • Rhythms. Lay out a schedule for the family to come together to review the plan and celebrate impacts they’ve made. How many grandkids attended college with these funds? How many local children had food and shelter because of the family’s contribution? Once you’re gone, these habits can carry forward for generations to come.

And, of course, you can lead these reviews during your life to demonstrate how you hope they will carry forward when you’ve passed.

Step four – Get family buy in

Your kids and grandkids are your future, the generations who will carry out your legacy. Whenever possible, it can be empowering to include them in setting family priorities, even asking what causes they care about that should be in the charitable plan.

While this can be difficult, especially in the face of conflict, it’s a valuable step to bringing the family together and unifying around your legacy vision.


Take the first step!

With a compelling vision, careful planning, and clear communication, you can change the future for generations of your family. But if you’re not sure where to start, a conversation with an advising team like ours at Alterra can be a great place to start. We’ll help you look at the big picture, build an action plan, and can be involved in family meetings to make sure they understand how your planning will bring your vision to life.

No matter how you choose to take this challenge on, get started! There’s no better time to begin shaping future generations of your family, helping them enjoy their lives and impact the causes they care about.

Mallory Hall - Alterra Advisors

Mallory Hall

Financial Advisor

About the Author

Mallory brings more than a decade of experience in boutique wealth management and institutional finance to Alterra. A Pacific Northwest native, Mallory completed her degree in Finance at Seattle University and later earned Certified Financial Planner™ and Certified Private Wealth Advisor® designations. She credits that education to a wonderfully supportive extended family. As she tells it, her family’s unwaveringly support inspired her passion to pass this education on to others.

Mallory looks at her financial education as a life-changing gift that she shares with enthusiasm. She thinks math is fun, and markets are interesting, but the work of a financial advisor is about doing good for others. Mallory has a natural knack for the analytics, but she is motivated by how this skillset can be applied directly to improve the everyday lives of her clients. Because she stresses the educational role of a financial advisor, Mallory’s ultimate goal is to be a “multi-generational advisor” guiding a family’s assets and goals as they change from one generation to the next.

In her spare time Mallory loves exploring the outdoors with her family. She’s also a passionate supporter of her husband’s business where they craft custom frames for a wide range of fine art.

The “Alterra” name was coined by joining the Latin roots “alter”, the origin of the word “altruism” with “terra” meaning earth or land. This name reflects the company philosophy of “clients before profits” and providing firmly grounded advice.

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