Over60
Retirement Income

Essential money conversations retirees should have with family

Discussions about funding retirement, aged care and inheritances may be uncomfortable. However, not having them risks your wishes going unmet and family conflicts where details aren’t clear. 

Hence having discussions about money while you are able to is one of the best (and cheapest!) investments you can make – for both you and your family.

Precisely what those discussions entail will depend on your circumstances – and theirs. Yet many points apply almost universally:

What matters to you

Even the best laid plans mean nothing if those responsible for enacting them don’t know what they are or understand your reasoning behind them.

Your will provides a legal overview of who gets what upon your death, while nominated beneficiaries determine how assets are divided from superannuation and some other structures.

A separate letter of wishes can informally share your wishes, covering more than just legalities. Sharing this before your death allows family to clarify your wishes and ask questions. 

Go through:

Partner protections

Ensure your partner knows how they will be looked after if they outlive you. Similarly, your kids should know what if any support they will need to provide – especially important for blended families. 

Where beneficiaries have divorced/separated, will you exclude their ex from your estate? Are your records updated to reflect this?

Ensure everyone knows the difference between joint tenants and tenants in common for property owners – only one automatically leaves your share of the property to your co-owner. 

Health matters

How do you want to be looked after in your final years? Don’t assume your loved ones already know everything.

Communicate your wishes, small and large – medications, dietary requirements, retirement living, palliative care, resuscitation.

Discuss whether power of attorney and enduring guardianship are needed should you be unable to make decisions over your health and finances (e.g., due to dementia or stroke), and who will assume those responsibilities.

Family legacy

Consider the legacy you want to leave and whether this aligns with your family’s expectations.

Is dividing assets equally among your children really fair if one is well-off while another struggles or has complex needs? 

Do your plans on inheritance unwittingly create headaches for the recipients – such as leaving property to someone who cannot afford to maintain it, or tax liabilities that eat into any financial gain?

Discuss non-financial legacy too: do your offspring know about your (and hence their) heritage? Are there special family mementos/stories to pass on? This knowledge may be lost if you don’t share it now.

Place to call home

Given their financial, logistical, and emotional implications, living arrangements are crucial to discuss before things need to change (and change can be imposed suddenly, such as by a health emergency). 

Consider:

Team united

Having everyone on the same page helps things to run smoothly – especially during difficult times such as a death or serious illness in the family.

Stay aligned by:

These discussions may be sensitive and difficult to initiate, but are crucial to ensure your wishes are known and enacted. Plus, they may encourage your loved ones to think about their own wishes – and give you all peace of mind for the future!

Helen Baker is a licensed Australian financial adviser and author of the new book, On Your Own Two Feet: The Essential Guide to Financial Independence for all Women (Ventura Press, $32.99). Helen is among the 1% of financial planners who hold a master’s degree in the field. Proceeds from book sales are donated to charities supporting disadvantaged women and children. Find out more at www.onyourowntwofeet.com.au

Image credits: Getty Images  

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retirement income, money, conversation, family