In recent posts we’ve discussed the importance of protecting wealth for future generations with an estate plan and how you can best communicate with your kids about financial literacy. But what if your heirs are not your offspring, but your parents?
Last week the world was stunned to learn of the death of former Zappos CEO Anthony Hsieh due to injuries sustained in a house fire. Just forty-six years old, Hsieh was considered a “visionary” by his contemporaries, not just for his business smarts but for his commitment to the revitalization of downtown Las Vegas. He also authored the book, Delivering Happiness: A Path to Profit, Passion and Purpose, which spoke volumes about his philosophy on life. At that young age he had already created an incredible legacy, and if tragedy hadn’t struck he surely would have continued to be a force for good in the world.
It’s always a reality check when someone so young passes away unexpectedly. We suddenly find ourselves taking a pause from the daily grind to think about the big picture. That’s especially true this year, when there’s been so much loss of life and financial security. According to a poll by Legal Zoom, there has been a significant uptick in estate planning because of Covid-19, including among eighteen-to twenty-four-year olds, even though barring underlying conditions this group is not considered high risk. This means that a lot more people who, like Hsieh, have no children should be having a conversation no parent ever wants to have: what will happen in the event their child predeceases them.
Be prepared to meet some resistance. Your parents are used to doling out the advice, but if financial literacy has not been a priority in your family it’s time for the student to become the teacher. Be thorough but simple in your explanations, and if necessary get help from your lawyer. Also, be sure to bring them up to speed on whatever technology you use, whether it’s Google Docs or an estate planning solution. And don’t just give them a cursory explanation – regularly engage them in its use. For example, by giving them permission to access your all-in-one solution, you can share information about assets and even get them involved in decision-making. You can also communicate with them through the platform’s direct messaging feature to show them it’s as easy as sending a text.
It’s not just about a will. Remember, your estate plan may include documents like life insurance and health directives in the event that you become ill or incapacitated. Be sure your parents have all the policy information, and that they are aware of your wishes with regard to your health. This way they will be able to discuss, and hopefully come to terms with, them should the unthinkable occur.
Remember, our biggest challenges also present the best opportunities to make positive change. It’s a fair assumption that once the pandemic is over many will slide back into complacency with regard to estate planning. Use this time “on pause” to reevaluate your assets, take advantage of the most efficient tools to manage them, and prepare your heirs of any generation to do the same should the unexpected occur.