The Case for An Annual Family Roundtable

family at dinner table having a lovely time together

Topic: Wealth Planning

R. Denys Calvin CFA

January 22, 2024

Image used with permission: iStock/FluxFactory


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The Case for An Annual Family Roundtable

Not long after I joined Nexus, Bill Berghuis imparted some good advice that has stuck with me, but took awhile to act on. He advanced the idea of a family “annual meeting”, characterizing it as a forum for discussing important stuff that might otherwise go unaddressed, not because of anything inevitably controversial about the topics, but because of the natural focus on matters more logistical and “in the moment” that often grab centre stage on occasions when parents and their adult children normally get together. Topics might include an impending career change, home purchase, health issue, or the like.

I began having these meetings with my daughter and son a few years ago when I decided the time had come to update my will to name them as executors. Till then, I had played my cards pretty close to the vest (as my own parents had with my siblings and me). That approach made sense when they were young, but not if they might have to take charge of important financial and legal matters without me able to play a guiding role. In anticipation, I sought some professional – non-legal – advice on getting my figurative “ducks in a row” for that first confab, as well as on how to have the conversation and what questions might arise. It may seem odd for someone in my line of work to seek such advice. But, just as every writer needs a good editor, there is real value in getting an independent view.

We typically have our annual family meeting in mid-December, just as things begin to slow down for the holidays and the instinct for end-of-year mental stock-taking naturally starts to kick in. We try to get together somewhere neutral and relaxing, like a favourite coffee shop, where we can linger without fear of interruption. The conversation covers a reasonable range of things. And I like to come armed with a couple of open-ended questions that I plan to pose to them.

One topic always on the agenda is a discussion of the financial stuff. A public company has to produce an annual report to shareholders. In that spirit, here’s what I pull together for my family “shareholders”.

First is a simple table of what we own and what we owe. It’s a balance-sheet-like list of financial accounts and assets, less any outstanding debts and other liabilities, including an estimate of taxes due on unrealized capital gains. It doesn’t include a comparison to prior years’ figures. But I’ll admit to examining the list to spot any material changes from the year before. That’s the financial analyst in me. Unsurprisingly, those changes often serve as sub-topics for the meeting. Excel is my weapon of choice for preparing this. Like the vaunted Procter & Gamble “one page memo”, having to distil the information so it all fits comfortably on one side of a sheet of paper helps keep the conversational focus on the forest, not the trees.

Second are the metaphorical “financial statement notes”. Think of this item as the explanatory fine print to accompany the first item. It’s a text document containing the background or rationale for various things, such as where my financial records and information are kept; why I have such-and-such an account; why the RRSP and TFSA beneficiary designations are the way they are; why my will, powers of attorney and any health directives are structured the way they are; and what recent changes I’ve made to any of these and why. In a sense, it’s a “Coles Notes” version of my will and intentions. That word “intentions” is emphasized…intentionally. Documents like wills, powers of attorney and health directives are great at conveying authority and responsibilities. But they seldom address the “why” – which is often critically important, and always a sensitive topic. I’m not doing anyone, least of all my family, any favours by leaving them to infer the “why”, especially if it’s potentially divisive. If it’s true that most disputes are rooted in misunderstanding, this is one way to improve the odds that everyone has the same understanding and, hopefully, avoid disputes in future.

These materials serve as helpful exhibits for our conversation. But they are only summaries. For additional detail and/or source documents, some sort of repository is required. Some people maintain a file folder or binder that is kept somewhere known to those who might have to consult it. (I’ve even heard it referred to as “the ducks-in-a-row binder”.) My preferred tool is Everplans, which is purpose-built for this sort of use. It contains a whole raft of different documents and information, including copies of my ID, will and powers of attorney; important names and addresses (doctors, lawyers and suppliers); a copy of last year’s tax return; and selected recent account statements. It’s accessible securely to each of us anytime, anywhere. In addition, although it’s got a definite U.S. slant, Everplans also offers a veritable treasure trove of general resource materials and help notes. In fact, we have a blog about it from a few years ago!

That’s it. With a more-or-less annual rhythm going now, it’s pretty easy to keep these three things up to date enough to be useful, but without being a maintenance burden. That said, the more time allowed to pass between refreshes, the more work it takes to do the update, and the easier it is to lose sight of something new that warrants inclusion.

Here are some observations from a few years’ experience with this process. Any initial apprehensions I had about sharing more than a heavily-redacted description of my financial affairs gave way as soon as it was clear my children could absorb the disclosure without drama, aside from an offhand comment like “I wouldn’t have guessed an RRSP could grow like that”. Even that comment turned out to be helpful – as an opportunity to reinforce the classic lesson about the power of combining decades of regular, annual saving with the magic of compound growth.

The natural instinct may be to discuss “important stuff” with each family member separately in a series of independent conversations. Unquestionably, the conversational dynamic is different when everyone is together. And there may be times when separate bi-lateral meetings would be more appropriate. But we have found that everyone, as well as the discussion itself, seems to benefit from the mix of comments, questions and reactions that inevitably arise in the group setting.

There are a few benefits from the annual cycle. When we’re together in that reflective, stock-taking frame of mind I referred to above, there are topics which get some impromptu attention that they otherwise might not attract at all. There are also family matters involving more than just our little nuclear unit that get an airing and sharing. Knowing we have this forum, it’s easy to seed the agenda with a new or unusual subject any of us has in mind. We’ve probably been able to talk frankly about some things in a less emotion-charged way than if they had had to be addressed in a hurry in one of those conversations that often opens with “If that’s [the case/how you feel/happened], then we need to talk about ‘x’ right now.” And when it comes to those potentially “hot” topics, it takes regular discussion to dissipate the heat – and avoid the full-on fire that might erupt in a moment of crisis. Finally, because thinking on a topic often evolves over time, the periodic discussion makes it easy to stay abreast of and attuned to that evolution.

This all fits squarely under the heading of “good communication”. It seems so simple and obvious. However, it may be more as Warren Buffett has said of investing: “It’s simple, but not easy.” And having heard too many unhappy tales of family communications gone awry, especially when there’s a nexus to money, Bill’s advice continues to strike a chord. If this strikes a similar chord with you, and you’d like Nexus’s help doing something like this yourself, please speak with your Nexus team member.

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