This may come as a shock to you: The holiday season is a great time for a family money talk.
Sure, you may want to avoid politics, religion and sex chats at your Thanksgiving or Christmas meal — but money should be on the table as a potential topic of conversation.
[See: How to Talk to Millennials About Money.]
“I think it’s actually a very good idea,” says Keith Rauschenberger, an independent fee-only financial advisor and president of Rauschenberger Financial Advisors in Elgin, Illinois.
Heck, conversations may spark organically during the holiday feast as older family members survey their progeny with misty eyes and contemplate their financial legacies. And even if they don’t start naturally, it might be wise to gently push the mealtime talk in a financial direction.
Here’s what to know about having a money talk during the holidays.
Discuss end-of-life plans. Estate planning, long-term care and medical preferences may be on the conversation docket, whether you like it or not. Older family members who have important information to share, such as what kind of medical care they want and don’t want, may find that the annual holiday gathering is a good time to bring it up.
“It doesn’t need to be a morbid conversation about end-of-life,” says Michael Resnick, senior wealth management advisor and certified financial planner at GCG Financial in Deerfield, Illinois. “It can be a discussion about the oldest generation’s wishes and desires for the future.”
Sometimes these conversations come up without prompting — and are instigated by the older family members. A grandmother may respond to your complimenting her new necklace by saying, “I’ll make a note to leave it to you in my will.”
Other times, it’s worth making a concentrated effort to sit down with family after the meal to get that conversation ticked off the to-do list while everyone who needs to be involved is sitting in the same room.
Of course, there are a few times when maybe it’s best to steer clear of end-of-life conversations, says April Masini, etiquette and relationship expert and author. “If someone in the family has a terminal illness or is the partner of someone with a terminal illness, it’s inappropriate to discuss wills, estate plans and anything that has to do with death and money,” she says. “The topic is too raw and should be conducted very privately and with specific sensitivity.”
Model good financial behaviors. “Family gatherings are a great time to educate youngsters (and not such youngsters) on good financial behavior,” Resnick says.
Unsolicited advice is usually pretty unpopular — and may elicit a few eye rolls from the kids. But younger family members can learn from older members’ frank discussions about their own financial successes and failures. Plus, a surly teenager may be more receptive to advice from a doting grandparent or cool cousin than from mom and dad.
[See: 10 Ways to Improve Your Finances with Social Media.]
Rauschenberger recommends putting a positive twist on the conversation and tying it to the idea of financial flexibility. “It’s about not being locked into so much debt or locked into so much stuff that you can’t make strategic decisions in life,” he says.
Tie it to a gift. If gift-giving is on the agenda, older family members can opt to select a present that comes with its own financial lesson plan.
For small kids, the gift may be a piggy bank with a quick conversation about what they could buy if they save their allowance for a month.
For older children, a gift contribution to their 529 college savings plan or retirement account may accompany a discussion about their goals and visions for the future. Integrating these conversations into the otherwise exciting process of ripping the wrapping off a present can make them easier to kick off.
You don’t have to solve everything. Don’t put too much pressure on this year’s holiday money talk. The chat you have around the holidays may simply be part of an ongoing discussion encouraging transparency and financial responsibility in your family. “Get those expectations out, and you can refine them over the years,” Rauschenberger says.
[See: 8 Big Budgeting Blunders — and How to Fix Them.]
Not every single financial uncertainty needs to be addressed or solved at dinnertime, but having routine multigenerational conversations helps get everyone on the same page.
Says Masini: “Allow your conversations to be an ongoing dialogue. Cut it short by saying, ‘I really enjoyed this — can we pick up on this topic Saturday? I’m free for lunch!’ Make the conversation agenda niche-based and you won’t get overwhelmed, frustrated, pressured and angry.”
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Financial Conversations You Should Have During the Holidays originally appeared on usnews.com
