Of all the uncomfortable things you have to talk to your parents about through the years, probably the toughest is their money. Yet, as your parents age, conversations about their money tend to become more and more necessary. This is especially true as the end of 2010 approaches, and the reality looms that – unless Congress makes a change – the estate tax will return next year with a only a $1 million exemption and a 55% top rate.
As an adult child of aging parents, this unprecedented situation with the estate tax can leave you in a tricky situation. On the one hand, it’s you want to make sure your parents are up-to-date on the status of the law; lack of knowledge can lead to unintentional and unnecessarily large payments to the IRS. On the other hand, especially if your parents consider finances a taboo subject, you don’t want to pry – and you certainly don’t want to look like you’re angling for a larger inheritance, or an immediate handout. Here are a few ideas for starting a conversation on the estate tax:
- Bring up current events. The estate tax has been prevalent in the news this year. From George Steinbrenner’s death to speculation over what Congress will do, there are plenty of news reports and blog posts you can refer to as a way to bring up the topic with your parents.
- Talk about your own estate plan. Be the first one to open up, and discuss your concerns.
- Suggest a meeting with an estate planning attorney. Especially if your parents haven’t reviewed their estate plan in awhile, this may be the time to get some updated advice.
- Don’t be greedy. If you don’t want to look greedy, make sure you’re not greedy. Remember, your parents’ money is theirs – not yours. And as much as you might disagree with their financial decisions, as long as your parents have the mental capacity to make those decisions, what they do with their money is up to them.