Four guidelines for discussing wealth transfer with your children

By ATB Wealth 16 October 2020 2 min read

“I want to leave my kids with enough to do anything, but not so much as to do nothing.” This is a common notion for many of our clients when planning the eventual transfer of their wealth to the next generation.

Your children grew up into adults without wanting and while it’s more than likely you’ve passed on lessons about personal responsibility and work ethic, discussions about money management and growing your wealth might still be far down on the conversation bucket list.

Here we provide some guidelines for having productive conversations about financial management. After all, it’s about more than money – it’s about creating wealth for several generations to come.


1. Set the stage for meaningful conversations

Discussing wealth transfer with your children is not the easiest task and is often avoided or delayed until it’s too late. But, meaningful conversations will help ensure your children are prepared for that stage of life and also, allow you to communicate your wishes.

While there is no perfect age to start these conversations, it’s something you can build over time. You can begin with small conversations or mentions to help prepare for the heavier topics or more in depth conversations. Give your children a chance to ease into the topic of wealth transfer.


2. Take their perspective

The difference between educating and dictating can sometimes come down to perception. It’s important to understand that, as adults, your children will want to make their own decisions, so engage in two-way conversations about financial management and understand how your children view their financial decisions. If these conversations tend to include raised voices more often than not, finding a trusted advisor or someone your child respects may help facilitate a more open conversation.

Getting to common ground on topics like wealth creation, investment choices, debt load, prudent borrowing and appropriate use of credit will make it easier to outline a wealth management plan that addresses your concerns, while providing your children with some autonomy in creating a plan that respects the family legacy.


3. Get them involved

Giving back is rewarding. It can be especially rewarding for entrepreneurs who connect with charitable causes within the communities that supported them and helped them become successful.

If you plan on allotting a portion of your wealth transfer to philanthropic causes, getting involved—and getting your children involved—in front line efforts with targeted charities will help create a better understanding of the importance of giving back with family wealth. This type of hands-on volunteering will help your children realize that philanthropy is part of your family’s legacy and they’re a part of that, too.


4. Create a unique strategy

There are several strategies for timing the transfer of wealth, from smaller transfers over time to a one-time inheritance and numerous measures in between. Some people see an advantage in staging the wealth transfer over several years. This allows them to help their children recover from potential financial missteps, as well as letting them see their children and grandchildren enjoy the wealth they’ve created.


The right strategy is different for every family. Understanding all the options for wealth transfer and then implementing a strategy that works within your family dynamics will go a long way in helping ensure your legacy lives on.


Original content created by: Vickie Burgess, Senior Private Client Advisor

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