Fidelity® Study Finds: While 70 Percent of Parents Claim to Be Very Comfortable Discussing Will and Estate Plans, More Than Half of Adult Children Are Still in the Dark about the Details

On Average, Children Underestimate Value of Parents’ Estate by

85 Percent of Parents that Discuss Will/Estate Planning with Children
Enjoy Greater Peace of Mind.

Fidelity Introduces New Fidelity
Estate Planner
to Help Customers Get on

BOSTON–(BUSINESS WIRE)–How prepared are American families when it comes to leaving a legacy and
discussing estate plans with their loved ones? Perhaps less than they
may think. According to findings from a recent Fidelity Investments®
Family & Finance Study, while the vast majority (90 percent) of parents
and their adult children say it’s important to have frank conversations
about estate plans and wills, all too often the discussions aren’t
taking place—or at least, in a meaningful way. In fact, while 70 percent
of parents surveyed believe they’ve had detailed conversations with
their children on the subject, more than one-half of their children
claim this isn’t the case.

“The study also reveals that more than two-thirds of adult children and
their parents disagree about the appropriate time to initiate
conversations about the parents’ finances. When it comes to legacy
planning, generally speaking, the sooner the better,” said Kevin Ruth,
Head of Wealth Planning and Personal Trust at Fidelity Investments.
“Failing to have an estate plan in place can lead to significant family
confusion once a beloved family member passes. Too often, it may result
in costly mistakes or the wishes of a loved one’s estate and legacy
plans going unfulfilled.”

Even in the simplest of family situations, conversations that do not
occur frequently and in detail may result in fairly substantial family
disagreements and disconnects. For example, the Fidelity study found
that seven in 10 parents and their children had major misconceptions
about the value of the parent’s estate – and on average, children
underestimated that value by $278,000. What’s more, while eight in 10
parents believe their children know where to find important documents
such as wills, power of attorney and healthcare proxies, only
two-in-three children actually report possessing this knowledge.

The potential for confusion only becomes greater—and the need to start
planning even more urgent—when one considers that the modern-day concept
of family may include stepchildren, in-laws and former spouses.
Furthermore, an estate plan provides protection for those left behind,
which may be especially important for loved ones requiring special care.
Without a will, the state laws where a person resides may determine how
the property is distributed upon one’s death, and this outcome may not
be aligned with what was intended nor be appropriate for a specific

A Sound Plan Offers Greater Peace of Mind and Helps Simplify the

Regardless of one’s net worth, passing on assets to the next generation
may involve a multitude of complex issues. Having an estate plan
in place may help simplify the entire process, by allowing you to
accomplish a number of things, including the ability to:

  • Preserve and maintain control over the transfer of your assets
  • Designate who will execute your wishes if you’re incapacitated
    or pass away
  • Protect your family’s privacy and possibly avoid probate
  • Provide immediate access to liquidity
  • Allow for the payment of bills in the event of incapacitation or
  • Choose who your beneficiaries will be and how they will receive

Additionally, having a sound estate plan in place may help one avoid
certain tax consequences. Without proper planning, an individual could
end up unnecessarily paying certain Federal estate taxes, as well as,
possibly, state estate and inheritance taxes. For retirement assets, a
good estate plan may help an individual avoid accelerated withdrawals
from an IRA—which would cause a spike to income taxes, as opposed to a
Required Minimum Distribution (RMD) over an heir’s life.

“No matter who you are or what your family portrait looks like,
establishing an estate plan is your best bet to ensure your loved ones
are taken care of in your absence,” continued Ruth. “While it is human
nature to avoid thinking about one’s own mortality, leaving the next
generation in good hands with the information they need to be successful
can help build a stronger family foundation. It may also provide you
with greater peace of mind and ensure your decisions and wishes are
carried out exactly the way you want.”

Tips for getting started

For those looking to plan for a family financial conversation around
estate planning, Fidelity offers the following guidelines, based on
numerous discussions held with families through the years:

  • Determine what factors you need to consider in your estate plan:
    Do you have children? How large is your estate? Are there special
    circumstances, such as blended families or children with disabilities?
  • Then, get organized: Although estate planning may seem like a
    lot of work, breaking it down into smaller, more manageable tasks can
    be tremendously helpful. Before you take action, understand the key
    topics that may arise as you address specific needs. A good
    understanding of the
    is critical.
  • Find the best estate planning attorney for your needs:
    Identifying the right estate planning attorney is essential to
    creating the right plan. Important initial steps include searching for
    qualified individuals, interviewing them to assess whether they are a
    good fit and understanding their fees.
  • Align your financial plan to your estate plan: Work with a
    financial consultant to review your estate plan, ensure your
    information is up to date and make sure your financial plan reflects
    your wishes. And keep in mind: most estate plans aren’t “once and
    done,” but evolve over time.
  • Set-up a financial check-in: Schedule time with your family to
    discuss your wishes, expectations, and the roles you anticipate your
    children will play. These check-ins give your children the opportunity
    to ask the difficult, yet important questions that otherwise may not
    come up. You’ll feel better about doing so, too: according to the
    study, 85 percent of parents who have had conversations with their
    children about will/estate planning matters reported feeling greater
    peace of mind..

Want More? Fidelity Offers Resources to Everyone and the New Fidelity
Estate Planner
for Customers

For additional information, Fidelity offers a comprehensive Estate
Planning Overview
for any questions people may have when starting as
well as helpful Viewpoints articles, such as Do
you need an estate plan?
and How
to find an estate planning attorney

In addition, exclusively for Fidelity customers, the company has
introduced the new Fidelity
Estate Planner
, an easy-to-use online service that helps organize
your information and documents, get informed on estate planning topics
and decisions you will need to make, and get connected to an estate
planning attorney, with tips and guidance on how to find and work with
the right attorney for you and your family

.About the Study

The third biennial Fidelity Investments® Family & Finance Study,
previously known as the Fidelity Investment’s Intra-Family Generational
Finance Study, is unique in that it surveys parents and their adult
children separately on a range of financial and retirement planning
topics to identify their level of agreement. The study was conducted
online among U.S. parents and their adult children during the period of
February 26 – March 22, 2016 by GfK Public Affairs and Corporate
Communication, using GfK’s KnowledgePanel®. The total sample recruited
for this study included 1,273 parents and 221 adult children. To
qualify, parents had to be at least 55 years of age, have an adult child
older than 25 and have investable assets of at least $100,000. Their
children qualified if they were at least 25 years of age, had money
saved in an IRA, 401(k) or other investment account.

About Fidelity Investments

Fidelity’s mission is to inspire better futures and deliver better
outcomes for the customers and businesses we serve. With assets under
administration of $5.7 trillion, including managed assets of $2.1
trillion as of December 31, 2016, we focus on meeting the unique needs
of a diverse set of customers: helping more than 25 million people
invest their own life savings, nearly 20,000 businesses manage employee
benefit programs, as well as providing more than 12,500 financial
advisory firms with investment and technology solutions to invest their
own clients’ money. Privately held for 70 years, Fidelity employs 45,000
associates who are focused on the long-term success of our customers.
For more information about Fidelity Investments, visit

Investing involves risk including the risk of loss.
Investments and Fidelity are registered service marks of FMR LLC.

The tax information and estate planning information contained herein is
general in nature, is provided for informational purposes only, and
should not be construed as legal or tax advice. Fidelity does not
provide legal or tax advice. Fidelity cannot guarantee that such
information is accurate, complete, or timely. Laws of a particular state
or laws which may be applicable to a particular situation may have an
impact on the applicability, accuracy, or completeness of such
information. Federal and state laws and regulations are complex and are
subject to change. Changes in such laws and regulations may have a
material impact on pre- and/or after-tax investment results. Fidelity
makes no warranties with regard to such information or results obtained
by its use. Fidelity disclaims any liability arising out of your use of,
or any tax position taken in reliance on, such information. Always
consult an attorney or tax professional regarding your specific legal or
tax situation.

The Fidelity Estate Planner is not an attorney referral service. When
applicable, participating attorneys, or their respective law firms, have
not paid a fee or compensation to be included or listed in the Fidelity
Estate Planner, nor does Fidelity receive any fee or compensation for
providing the law firm and attorney contact information to its customers.

Fidelity Brokerage Services LLC, Member NYSE, SIPC
Salem Street, Smithfield, RI 02917

© 2017 FMR LLC. All rights reserved.


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