Graphicscoco/iStockPhoto / Getty Images
When Mary Ma’s mother died in 2021, she didn’t have a will – which meant her family didn’t know exactly how she wanted her end-of-life care to proceed, and they had to go through hoops to close her accounts and move her money.
“Even with her super-simple financial situation, there were quite a lot of tasks,” says Ms. Ma, a product designer who now works for Willful, an online will company. “I stepped into that role without a legal paper.”
“That took a toll on my mental health, and I think prevented me from grieving.”
Ms. Ma says she knew her mother had brain cancer for about two years before she died, but it never seemed to be the right time to talk about her end-of-life care and estate. Her mother’s illness meant there was always a lot to do in the short term – things like getting to appointments and co-ordinating caregiving and meals – so the talk took a back seat.
“They kept pushing it off when I brought up the conversation with dad and my mom,” recalls Ms. Ma, who lives in Ottawa. “The response was like, ‘Yeah, we should do it, but later.’ I guess later never came.”
Ms. Ma says she avoided pushing harder because it made her mother’s diagnosis feel more real, something she regrets, and her husband was nervous to bring up the issue in case it seemed like he was angling for an inheritance.
Experts who work with families on their estate planning say these feelings are typical when talking to parents about their wills and estates – but there are ways to normalize the discussion and make it less awkward.
“Most kids have their parents’ best interests at heart,” says Robin Taub, a Toronto-based chartered professional accountant and author of The Wisest Investment, a book about teaching financial literacy to the next generation. “No one wants to sit down with their parents and say, ‘How much money are you going to leave me?’ I would never suggest starting a conversation like that.”
Instead, she recommends opening the conversation by asking if the parents have done any estate planning – without “pushing or prying” – and seeing how they react.
“You can come from the angle of, ‘We want to make sure you have a lot of money to live comfortably in your retirement,’” she says, noting it’s wise to keep the focus on their wishes and how they’d like to see their money used. “It’s not your money, it’s their money, and they’re entitled to decide what to do with it.”
Some of the topics worth discussing include life insurance, critical illness insurance, and who will be the main caregiver for the parents as they age, she says, adding the conversation is worthwhile whether or not the parents have wealth to hand down.
“If the parents don’t have money and you’re the one who’s going to support them, you need to have open information,” she says. “If things are secretive, there can be so much poor planning.”
Tom Deans, author of several books on intergenerational wealth transfer, says approaching estate planning “like a do-it-yourself project” often leads to some family members feeling left out or shocked by what they find out after someone has died. He adds that having these conversations early and often can save the family dynamic, in addition to saving significant amounts of money.
“One of the great non-financial gifts we can give our family is these conversations,” he says. “The happy inheritor is someone who is inheriting wealth and not surprises and secrets.”
For those wondering how to get the conversation started, Mr. Deans recommends leading by example.
“The rising generation should go get their will and power of attorney drafted and share a copy with their parents. Parents are often like, ‘We should probably be doing this too,’” says Mr. Deans, who is based in the Hockley Valley, about 80 kilometres north of Toronto.
He recommends families use a trusted adviser or mediator to help lead these discussions. Having someone neutral present often leads people to “approach those family conversations with more maturity” and “check their emotions,” rather than reverting to old patterns of communication, Mr. Deans says.
“A first family meeting could be a one-agenda-item meeting: selection of executor,” he suggests, noting people often leave a first meeting of this kind feeling relieved that things are under way and wondering what to do next.
“Maybe that next meeting is talking about who’s going to provide late-in-life care for mom and dad.”
The alternative to these conversations can be inheritors hashing out the details in court, which can eat up huge sums of the estate, he says, noting it can cost $500,000 to get through the litigation to get to a one-day trial.
“If you think divorce is expensive, it’s just a dress rehearsal for the big show,” he says.
Are you a young Canadian with money on your mind? To set yourself up for success and steer clear of costly mistakes, listen to our award-winning Stress Test podcast.
