Why the Holidays Aren’t the Best Time to Have Family Money Talks

Timing is really important when it comes to talking to your adult children about your finances. The holidays might seem like the perfect opportunity to have these conversations because you andyour children will be together in one place (that is, when there’s not a pandemic making gatherings a challenge). You’ll be celebrating, and everyone will be relaxed. Perfect time for a family money talk, right?

Wrong. A holiday meal is not the ideal time to. Your efforts to discuss what could be an awkward topic could easily backfire. So before you say, “K, pass the turkey and let’s talk about my estate plan,” consider the cons o trying to start this conversation during the holidays.

3 reasons not to mix money talks with holiday meals

To be clear, it is imperative to have family money talks. The sooner you can share details about your finances, the more prepared you and your adult children will be if an emergency pops up and they have to help you with money matters. However, there are three key reasons why it’s better to wait until after the holiday meal to—forgive the pun—talk turkey.

Holiday gatherings can be stressful. Talking about money also can be stressful. So if your family’s holidays look more like a scene out of “National Lampoon’s Christmas Vacation” than a Norman Rockwell painting, the last thing you want to do is start talking about money to turn up the tension.

There could be people there who don’t need to be a part of the conversation. Your holiday meals might bring together aunts, uncles, cousins, grandchildren and even family friends. As concerned as these people might be about your financial well-being, they probably don’t want to be dragged into a conversation about money at the dinner table. More importantly, you shouldn’t put your children on the spot by forcing them to have a conversations they might consider awkward in front of a crowd.

Adding alcohol to the mix could spell disaster. Don’t assume that your children might warm to the idea of discussing financial matters after a few drinks. In fact, if someone has had too much wine during the holiday meal, the conversation could go downhill real fast. 

When to talk to about your finances

If the holidays are one of the few times you and your children gather in person, let them know after the meal that you'd like to find a time to talk with them. Agree on a time when you can sit down—or chat on a video call—without rushing to go over a few details about your finances.

It's important to talk with all of your children, even if you expect only one of them to take an active role in your finances as your age or when you die. You don't want to create division among your children by leaving some of them out of the conversation. However, that doesn't mean you have to share all the details of your finances with all of your children. Just clue them in to some of the planning you've done.

How to start the conversation

Your children might welcome a conversation about your finances. However, this can be a stressful converation for some children because it can bring up the issues of aging and death. So you might need to approach family money talks carefully to get your children to listen. You don’t have to avoid difficult conversations altogether. However, you’ll have more success making your kids comfortable with these conversations if you avoid using words such as these:

• Worried
• Afraid
• Emergency
• Worst-case scenario

You want to give your children peace of mind that you’ll be OK as you age, so use reassuring words, such as "I want us all to be on the same page" or "I want you to know that I am prepared financially."

There are a variety of strategies you can use to start these conversations in a natural way, as opposed to saying, “Let’s sit down and talk.” If you’ve been meeting with an accountant or financial advisor, you could talk about your financial planning experience. You could use current events—the pandemic, for example—to highlight the need for planning. You could even offer your children financial advice if they’ve just started a job, gotten married or had a child by sharing steps you took (or wish you had taken) when you were their age.

What information you should share

You don’t have to tell your children everything they need to know at once. That can be overwhelming. Instead, have a series of conversations. You could start with the easy stuff, such as where you keep important documents or what your plans for retirement are. Work your way up to more sensitive topics, such as what sort of support you might need from your kids if you have a health emergency.

You also don’t have to share all the details of your finances or estate plan—as in, who gets what when you die or how much is in your retirement savings account. However, you should provide them with key information that will allow them to step in and help you with money matters if something were to happen to you.

• Whether you have estate planning documents—such as a will, power of attorney and advance directive—and where the documents are located
• Your plans for retirement
• What sort of long-term care planning you’ve done and whether you’re counting on your children to help
• How you pay your bills and how they can be paid if something happens to you
• What sort of financial accounts you have (checking, savings, credit cards, retirement savings, brokerage account)
• What sources of income you have
• What sort of insurance policies you have
• Names and contact information for financial professionals you work with
• Final wishes

Consider making a detailed list of your personal, financial and medical information. You could share it with your children or hang onto it and tell them how to access it and under what circumstances. By giving them as many details about your finances as possible, you’ll be giving your children peace of mind that they have the information they need if something were to happen to you.

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