A Step-by-Step Approach to a Successful Conversation

A Step-by-Step Approach to a Successful Conversation

When Ryan Inman’s stepdad had a stroke, it caught his mom off guard. Although Jimmy, his stepdad, was 70, he was in great shape because he worked out three hours every day by lifting weights and running. And Michelle, Ryan’s mom, thought she had a handle on their finances.

But when the stroke landed Jimmy in the hospital and the doctors discovered he had bone cancer, Ryan said it became obvious that his mom hadn’t taken steps to organize the couple’s finances to deal with an emergency like this. As a certified financial planner and founder of Physician Wealth Services,1 Ryan wanted to talk to his mom about her lack of planning but knew it wasn’t the right time because she was struggling emotionally with her husband’s diagnosis.

Fortunately, Jimmy beat the cancer. But Ryan said that his mom and stepdad never took the time to get financially organized to prepare for another emergency. That worried him because he had seen how hard it had been for them before when they weren’t prepared and could see that Jimmy’s health was deteriorating, which meant they could end up in the same situation once again.

Ryan knew it was time to have that talk with his mom about her finances that he had wanted to have when his stepdad had a stroke. This time, there was no excuse not to have it. “You can always say there’s never a right time, but there’s never a wrong time, other than during a crisis,” he said.

Indeed, Ryan did have a conversation with his mom – several, actually – and it went incredibly well. He admits that being a financial planner helped him know what to ask his mom about her finances and, more importantly, how to ask. Because his approach was carefully planned, it’s worth replicating when talking with your parents about their finances.

Of course, everyone’s situation is different. But following Ryan’s step-by- step approach that helped him have successful conversations with his mom

about her finances might work for you.

STEP 1: CHOOSE THE RICHT TIME AND PLACE TO BROACH THE TOPIC

Ideally, you want to talk with your parents about their finances before a crisis strikes. As Ryan witnessed, emotions are running high when there’s an emergency, so it can be difficult – or even impossible – to gather the information you need at that time.

Instead, choose a time to bring up the topic of money when your parents are relaxed and in a good mood. Ryan decided to start asking his mom about how prepared she was for another emergency while he was visiting her with his two young children. “She’s got the grandkids around, so she was in a good mood,” he said. “I made it so she was very comfortable in a setting that was her own and brought over her two favorite people in the world.”

STEP 2: EXPLAIN WHY YOU WANT TO HAVE THE CONVERSATION

While relaxing with his mom and watching his kids play, Ryan casually mentioned to her that he had recently talked to her husband, Jimmy, and that he didn’t sound too good. He then asked whether they had everything in order if something were to happen to Jimmy.

“I was like, ‘You know, Mom, do you have stuff together? I want to make sure your will is together because Jimmy is starting to fail. It could be a year, it could be 10 years.” He told her they needed to get all of their estate planning documents updated and to go over all of the accounts she and her husband had while he still was coherent. “I told her, ‘This isn’t for me to figure out what I’m going to get or not get. You just need to be prepared. We need to make sure everything is taken care of,’” Ryan said.

The key is to let your parents know you want to talk about their finances so you can help them plan and be prepared. Don’t focus on what you hope to get out of the conversation, Ryan said. Instead, tell them you want to help

them make sure everything is in order now to make it easier for them if something happens.

STEP 3: FIND A QUESTION TO PROMPT THEM TO TALK

On the one hand, Ryan said it was easy to bring up the topic of finances with his mom because money has never been a taboo topic in his family. However, he doesn’t think she would have been willing to have more conversations and share details of her finances if he hadn’t asked her the right question.

Ryan knew that his mom and stepdad had a prenuptial agreement and separate financial accounts. So when he started talking to her about whether they had their finances in order, Ryan asked his mom if she knew what financial accounts his stepdad had and where they were. “I think when I asked her does he still have separate property, she didn’t know,” Ryan said. “That was a prompting question to get her intrigued into thinking, ‘Uh oh, maybe I don’t know everything. Let’s look at it.’”

Ryan recommends finding a prompting question you could ask your parents to get them thinking about why it’s important that they discuss their finances with you. Using a story, a life event, or any of the other conversation starters in €hapter 7 also can help. “That’s your door in to talking about it,” he said. Then you could offer to help them get organized or make a plan in cace something happens (which it will, but you don’t need to scare your parents by pointing out that they will die, could have serious health issues, or end up needing long-term care).

STEP 4: SCHEDULE A TIME TO TALK IN DEPTH

Once his mom agreed that they needed to look into her and her husband’s financial situation more, Ryan didn’t start prodding her for information. “I said, ‘Mom, if you want to talk about this, let’s do it when the kids aren’t around. Let’s set up a time,’” he said. Then Ryan got out his calendar and scheduled a time to meet with his mom to discuss her finances. So she

wouldn’t feel overwhelmed, though, he told her they would only talk about 20 to s0 minutes.

STEP 5: START WITH THE EASY STUFF

Ryan went to his mother’s house for their first scheduled money conversation and started with questions about banking that he knew she could answer. He asked at which bank she had accounts, what sort of accounts she had, and how many accounts she had. “Start with the easy stuff first,” Ryan said. “That’s an easy win.”

He never once asked about how much money she had in her accounts. In fact, he told his mom he didn’t care about the dollar amount – only about the type and number of accounts she had. However, he did create an account on Dropbox.com, which lets you share files easily with other people. He asked his mom to download her most recent bank statement that listed the accounts she had, along with the account numbers, and save them in a Dropbox file so that he could access it if it ever was necessary. “That way I know where it’s at if something happens to her so I can help,” he said.

STEP 6: DO IT OVER MULTIPLE CONVERSATIONS

Ryan didn’t ask his mom to share all of the details of her finances in a single meeting. In fact, he met with his mom several times over the course of three months, which is what he recommends that others do, too. “Take it in small doses,” he said. “After a certain amount of time, you get tired. People who really don’t like talking about it will get tired really quick.”

Each time Ryan and his mom met, he focused on only one aspect of her finances. After they talked about banking during their first meeting, he then asked her about her debt. Ryan found out that his mother didn’t have any.

But if she did, he would have asked her to list all of her lines of credit and what she owed.

Next, he asked about her investments, which was a more challenging conversation because his mother has several investment accounts and

investment properties. Plus, she didn’t know what accounts her husband had, so Ryan had to ask his stepdad to share that information with them.

Ryan then made a list of all of his mom’s and her husband’s investment accounts and got account statements to save in the Dropbox file. He also had his mom make a list of all of her rental properties with details such as addresses, property managers, and names of tenants for each.

In other meetings, he focused on cash flow – what sources of income his mom and stepdad have. “I told her, ‘You don’t have to tell me the numbers. I just need to know that you know where it’s coming from,’” Ryan said.

However, he did ask her to make a detailed list of income sources in a Word document and save it in the Dropbox. He also gathered information about all of the insurance policies – auto, homeowners, life, and so on – that his mom and stepdad have and asked them to put digital copies of their policies in the Dropbox.

STEP 7: LISTEN WITHOUT BIAS AND WRITE DOWN EVERYTHINC

As you talk with your parents about their finances, Ryan cautions that it’s important not to pass any judgment on them. As you know, talking about money can be difficult for many people. It might be especially hard for your parents if they are embarrassed about their financial situation. “You just have to ask the questions and listen,” Ryan said.

As you listen, though, write down any important financial information your parents share with you, such as the types of accounts they have. Ryan recommends taking notes with a pen and paper rather than a computer because typing information into a computer will make the conversation feel more formal. “You want to make them as comfortable as you possibly can while talking through something uncomfortable,” he said. You can always go back and transcribe your notes on a computer in a Word or Excel file. If your parents aren’t comfortable sharing specific details about their accounts, debts, insurance policies, or estate planning documents, you could ask them to write down that information themselves and store it someplace where you could access it if there is an emergency and you need it to help them.

For more details on the type of information you need to collect, see €hapter

STEP 8: FIND A WAY TO MAKE THE HARDER CONVERSATIONS EASIER

Ryan saved the toughest conversation with his mom for last – the conversation about end-of-life planning. “It’s a harder conversation because you don’t want to seem like the kid who wants to know what their inheritance is,” Ryan said. And, of course, that wasn’t his goal. He simply wanted to find out whether his mom had recorded her final wishes. He also wanted to make sure that she and her husband had health care directives that spelled out what sort of end-of-life care they wanted and that named financial and health care power of attorneys to make decisions for them if they couldn’t.

To help keep the conversation more relaxed, he took his mom to lunch and didn’t take notes. “I said, ‘Look, this isn’t for me, it’s for you. When Jimmy dies, you’ll not only be grieving, you’re going to have a lot of work. Let’s get this work done now when it’s easy and you’re not in a different state of mind,’” Ryan said. He also pointed out that this was something his mom and her husband needed to do before Jimmy’s mental and physical health declined more. For legal documents to be valid, a person has to be mentally competent to sign them.

As they talked, Ryan found out that his mom and stepdad had wills and financial power of attorneys that hadn’t been updated in a while. Plus, neither had an advance health care directive. Ryan told his mom that it was imperative that they both have this essential document drafted to detail the type of treatments (such as life support) they would or would not want to receive if a medical emergency left them unable to communicate their wishes. Without those documents, their loved ones wouldn’t know what they wanted, he said. Ryan told his mom that she didn’t have to tell him right then what she wanted but that she needed to think about it and meet with an estate planning attorney.

“I put the harder questions on the estate planning attorney,” Ryan said. “I wanted a third party to get the answers to those questions.”

He also told her what sort of other information the estate planning attorney would want so she could be prepared to provide it when she met with one. Fortunately, she had already gathered most of that information during her money conversations with Ryan and stored it in Dropbox files.

Within two months after their lunch meeting, Ryan’s mom had met with an attorney and had signed all of the estate planning documents she needed.

She emailed Ryan her attorney’s contact information, whom he can contact if there is an emergency and he needs access to the documents. “I now know she got everything done according to her wishes,” Ryan said.

(Note: Most attorneys do not keep original versions of estate planning documents that they draft on file. So don’t expect that your parents’ attorney will have their documents. Even if they do have them on file, they likely won’t be able to give them to you unless you’ve been named your parent’s power of attorney.)

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