Money Makes the World Go Round, But Don’t Talk About It?

We’ve all heard “never discuss religion, politics, or money” in a social setting because you may cause yourself and others discomfort… But what about at home, with your immediate or even extended family? Religion and politics are likely a common topic, especially within the confines of one’s home. If I asked you to think about the last time you discussed politics or religion with your family, it probably wouldn’t be too hard to recount the last related conversation. Can you easily recall the last time your family discussed money?

A majority of Americans do not regularly talk about money. If money makes the world go round, why is it so uncomfortable for some of us to talk about? Well, there are generational differences – for some generations, money is still considered to be a taboo subject. If your parents did not openly discuss money, it may be difficult for you to start a conversation with your spouse and/or children. Humans are naturally opposed to being uncomfortable; we often seek the easier route. Being uncomfortable isn’t negative. Just like with anything else, we grow from doing things we haven’t done before – by having a conversation that may be slightly outside of our comfort zone.

Here’s your permission to break the rule: talking about money builds confidence, helps individuals make better financial decisions, and ultimately build wealth. I am encouraging you to talk about money with your family. You don’t have to share what your salary is or how much you have in savings. You can check in on money-related matters, for instance, ask your parents if they have an estate plan and if it’s up to date; are their assets appropriately titled; do they have beneficiaries named for their accounts? Start having conversations with your children. Children are innately curious – start discussing earning and saving with them.

Our three-year-old daughter loves to hunt for coins when we are out and about. The excitement when she finds a coin (or, honestly, even when we find a coin to bring home to her) is quite fun. She puts her new treasures into her piggy bank and watches her savings grow. Sure, she’s three and may not completely grasp the concept, but she is actively saving. She recently filled the piggybank to its brim, so we rolled her coins as a family, and went to the bank to deposit the fruits of her labor. We explained what we were doing and why. We started the conversation small, it’s fun for her, and our hope is doing these kinds of things with her will open the door, allowing her to feel comfortable to ask questions about money when they arise in the future. I’ll have to report back in 15 years to see if any of it sticks.

If your children are adults – have you shared details of your estate plan with them? Some individuals may leave children unequal amounts for a variety of reasons – possibly because the other(s) may be receiving an interest in a family business, jewelry, a residence, or perhaps because they have a greater need (e.g., an ongoing medical concern). If these types of decisions are not communicated it could lead to confusion, jealousy, or hard feelings amongst family members or assumptions about why you made this decision.

Have you named one of your adult children to serve as your Durable Power of Attorney (to handle your finances if you’re unable to do so) or as Trustee? If so, it would be beneficial for them to know they have been selected to serve in this capacity – show them where your important documents are, where your assets are held, and the contact information of your professional advisors. If you have multiple children, it would be beneficial to let the others know of the choice to name one of their siblings to serve, so it isn’t a surprise when the named child needs to step into the role. You likely have a reason for selecting one to serve (perhaps its proximity to you, time considerations, skill set, etc.); communicating this can go a long way. A lack of communication can breed assumptions, and we all know what they say about assumptions… If you need a default explanation for choosing one over the other, you can use this: some institutions (Greenleaf Trust is not one of them) will not accept direction when two agents have been named, so you choose one to prevent future headaches and delays.

Perhaps previous generations avoided discussing money because they didn’t want their children to think money is everything. Most of us have heard “money doesn’t buy happiness” throughout our lifetimes. While this may be true, being comfortable with money, knowing how to make wise money decisions, and being able to have conversations about or relating to money is worth its weight in gold.