Families. They’re funny things, aren’t they? They can engender love and hate, anger and joy, frustration and pride – sometimes seemingly all at once. But for most of us, family is something we are stuck with, for better or worse. So it makes sense, then, to try to find common ground with parents, siblings and kids. Especially when it comes to talking about and negotiating the subject of money. Because not much good can come from financial family feuds.
You probably won’t be surprised to learn that most financial family feuds revolve around inheritance. When mum and/or dad pass away, the chances are you will already be emotionally fragile and grieving.
The grieving process can be a long one. If you can avoid other stresses during that period you’ll likely be able to get through it in better shape. But if other family members are not on the same page when it comes to dealing with a lost loved one’s finances, it’s not likely to help.
How can financial family feuds be avoided?
It’s a thorny question, but there are potential answers. The best answer is try to make sure that you get everything in order in advance, as much as possible, of course.
There are two sides to this family equation. One belongs to the person who will be passing on their inheritance, usually the parent. The other is the likely and/or possible beneficiaries of the inheritance.
First, for the person whose wealth and possessions will be divided, the priority is to write a will. The second is to keep it up to date. By having a will in place, those left behind will at least have an idea of your preferred intentions. They might not agree with them, but they will have them there in black and white.
Keeping the will up to date can go a long way to avoiding financial family feuds, too. With blended families now a common phenomenon, circumstances can change relatively often. Everyone may not be in favour of the will you wrote five years ago if your – or their – family arrangement has changed. Even if it was met with agreement at the time or writing.
Making a will is good. Keeping it up to date is great. Making it specific is even better. The more specific you are, the less wiggle room there is for argument between beneficiaries.
Consider also, allocating by percentage. This will alleviate potential disagreements about a possession, such as a house, that may no longer be part of the estate. This is often the case for those who have moved into an aged care facility.
What can you do as potential inheritors?
Perhaps the best thing you can do is to start discussions about inheritance with your family long before the event. Nobody really wants to imagine the idea of a loved one dying, but it’s a reality we all face. If we can be as prepared as possible for when that time comes, the risk of financial family feuds will be greatly reduced.
I’m pleased to report that before my mum and dad passed away a few years ago, I had these discussions with my siblings. There are six of us, so the potential for conflict was real. But we dealt with the matter civilly and with respect for each other.
When the time came, we were indeed all on the same page. We were able to celebrate the lives of mum and dad without the spectre of conflict hanging over us.
I suspect a fair bit of luck was involved in my case, but regular communication certainly helped. Communication, early and ongoing, can be greatly beneficial.
Have you made any preparations for inheritance? Or have you been through the inheritance process, happily or otherwise? Let us know in the comments section below.