How to talk to your adult children about their inheritance
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A new study suggests that older Americans really don’t like talking about inheritances with their adult children.
According to Fidelity Investments, nearly two-thirds (68%) of parents ages 55 and older with at least $500,000 in investable assets have not told their adult children what they will inherit or whether they will receive any inheritance at all. 2025 Family and Finance Survey. Nearly a third, or 35%, do not want their children to know how much they will receive.
Financial advisors say reluctance to disclose estate plans is common. Reasons may include concerns about their children losing motivation or starting conflicts, or even discomfort with discussing money in general, said certified financial planner Mitchell Kraus, founder and principal of Capital Intelligence Associates in Santa Monica, California.
“But avoiding the conversation often leads to bigger problems later,” Kraus said.
$124 trillion expected to go to heirs by 2048
The Fidelity study included a matched sample of parents ages 55 and older who had at least $500,000 in investable assets and whose children were ages 25 to 54, as well as adults ages 25 to 54 with a living parent age 55 or older who had at least $500,000 in investable assets.
Although 25% of their parents disagree, a majority (95%) of adult children say they are prepared to manage inherited wealth, Fidelity finds.
Baby Boomers (those born between 1946 and 1964) and older generations have an estimated $124 trillion to transfer between 2024 and 2048 as part of the so-called massive wealth transfer. Research by Cerulli Associates. Of this amount, $105 trillion is expected to go to heirs and the rest to charities. More than half of that $124 trillion is expected to come from people with at least $5 million in investable assets, according to Cerulli.
No need to share ‘integers’
Financial advisors often recommend discussing your estate plans with your adult children, even if you only provide a broad overview.
“We generally recommend that they at least tell their children how the assets will be divided,” said KC Smith, managing partner of CFP. Henssler Financial in Kennesaw, Georgia, ranked No. 46 on CNBC’s Financial Advisor 100 list this year.
“You can share some basic information about the structure of your estate plan, but keep the exact numbers undisclosed if you think it would be problematic,” Smith said.
An estate plan isn’t just for the wealthy. In basic terms, it should include a living will that specifies not only where you want your assets to go, but also who will be given power of attorney for financial decisions, as well as your wishes regarding end-of-life health care.
Certified financial planner David Kozlowski, president of Verus Financial Partners in Richmond, Virginia, ranked No. 8 on this year’s CNBC Financial Advisor 100 list, said there’s a special situation when it might be best not to discuss plans with an adult child.
Kozlowski said that’s when they “still enable their adult children.”
If the goal is financial independence, “our experience is that discussing inheritance with children whom retirees are still supporting will lead to greater dependence on their parents, not less,” he said.
Handling irregular inheritances
Additionally, it may be more difficult to ask to share information regarding unequal transfers of your assets (for example, one sibling receiving more or less than the other). However, financial advisors often recommend getting the conversation out of the way to avoid conflict after you’re gone.
“Adult children almost always respond better when parents explain the thinking behind their decisions, even if the plan is not completely up to par,” Kraus said. “It gives them context and makes it easier for someone to ask, ‘Why did my mom do that?’ It prevents that classic moment when he asks: “When no one can answer.”
Smith said there may be another reason for avoiding talking about exact numbers. “Just because there’s ‘X’ dollars today, that doesn’t mean it’s going to look like this when you die,” he said.
Smith said conditions will change and it’s impossible to know how dramatically it will happen. “If something happens that we didn’t anticipate, then [inherited] the amount can be significantly different,” Smith said.
But if the inheritance is likely to impact the child’s inheritance or tax planning in an unexpected way, it may be helpful to give them a better idea of what lies ahead.
It’s a good idea to include some other important estate planning information with your adult children, too, such as who to call if something were to happen to you, where the will or trust document is kept — “things like that so they’re not confused when they’re going to grieve openly and make an estate settlement, which can be complicated,” Smith said.
