Published November 23, 2011
For most American families, there's one major money-related tradition associated with Thanksgiving: Black Friday shopping. But for others, bargain hunting takes a back seat to a financial reality check. They use this time together as an opportunity to discuss and review a host of financial issues ranging from estate planning and wills to investment and philanthropy.
And financial advisers, who sometimes attend more formal versions of these Thanksgiving conversations, have much to share in terms of what direction these meetings can take. They stress that with a little preparation, and a lot of nonconfrontational goodwill, families can come out with an increased sense of connectedness, cooperation and shared vision.
Still, it's hard to gauge how family members will react, even to the most innocuous statements. Every tribe has its more emotional and melodramatic types, and so it's crucial to limit the chances of misinterpretation or outbursts. This may be especially true if younger adults are involved and feel cornered in front of the whole family, experts say.
"Listening is the most important part," says Ben Tobias, president of Tobias Financial Advisors in Plantation, Florida. If a son or daughter wants to join the Peace Corps instead of get a more traditional job, "find out the reasons why, and remember that doing something for two or three years can be a valuable experience. But ask, 'Have you given any thought to your plans after that?' You want them to look a little more in the future than just immediate gratification."
"It's like the facts of life talk with our kids; no one wants to have it, but you have to do it," says Eleanor Blayney, consumer advocate for the Certified Financial Planner Board of Standards. "People worry that if they sit down with Mom or Dad, it will be awkward or difficult. But it's important to open up about your goals and aspirations, and then ask people in the family what their situation is. You model the conversation by sharing where you are."
Conversely, Blayney says these meetings may go "one generation up," where the needs of aging parents or grandparents get discussed. That gets tricky for many, as three out of four Americans have never discussed long-term care with their loved ones, according to Genworth's 2011 Financial Reality Check Study.
If that subject is on the agenda, "Be straightforward and don't take family members by surprise," says Genworth national spokesperson Wendy Boglioli. "Tell your family that you have something important you want to talk about and do it in a comfortable, pleasant setting."
"With elder parents, you have to ask them if they need some help with living expenses, medical expenses, all sorts of things," adds Bob Stammers, head of investor education for the CFA Institute, a global nonprofit of investment professionals from more than 100 countries. "Some people don't like to talk about it, and so you have to come at it from the heart. The older generation doesn't like to admit they need some help."
Then you have families facing pressure on both ends. "Boomers in particular worry about being 'sandwiched' and having to support both elderly parents and adult children who are unemployed or facing financial difficulties," says Charles Sizemore, principal of Sizemore Capital Management in Dallas, Texas and author of the Sizemore Investment Letter. He thinks that this Thanksgiving, discussions of this type will dominate many family meetings.
But how much gets done at these summits depends on the sum total of interruptions, as no football-loving guy will keep his mind on the big picture when he has his eyes on the big screen. Indeed, the toughest piece of advice to follow comes from http://moneymanagement.org: "The family financial meeting should occur with little to no distraction. Keep the television off, and refrain from answering the phone, texting or looking at your BlackBerry."
"I've done them, I've been part of them and they're interesting," says Grant Rawdin, president of Wescott Financial in Philadelphia, Pennsylvania. "But if this is step one, it's not a good idea for me to be there; you're just introducing the topics, you're talking about family relationships -- and you want to keep it very informal."
Rawdin says the time to bring in a financial adviser is when you tackle the tougher stuff -- anything from making decisions on a shared vacation property to living wills and power of attorney. There also may be involved in discussions about family assets, in which case "the patriarch and matriarch will probably want me to be there, and that's when I would lay out a plan and the specific steps."
As for Stammers, he'll hold a Turkey Day financial summit, as is usually the custom with his family. This year it's at his sister-in-law's New Jersey digs, with both his adult daughters flying in from Atlanta and 13 people gathered at the dinner table.
Together they'll address care for his aging mother-in-law, who lives in the Dominican Republic with her husband. "It's something we talk about all the time: What happens when her husband dies?" Stammers says. He'll also check in with his grown daughters to see how they're doing financially and help them refine their retirement planning.
"Achieving your family goals is about planning," Stammers says, "and the dinner table is a good time to talk openly about finances, take that information and turn it into an investment strategy or planning strategy."