Have you or haven’t you cut the financial cord with your family?

This is the question asked in this illuminating piece in the New York Times today 

This article points out some remarkable pathways that open up based on the level of dependence of an adult child.

In estate planning we see this routinely.  More than routinely – we see it commonly. Not just the so called ‘failure to launch’ syndrome of adult children still living at home playing Red Dead Redemption all day, but adult children, well into their thirties, with their own children and with stable, decent jobs and spouses and lives of their own, still being looked after financially by their own parents.

Is this the fault of the parent, or the child?  Or is it a necessity? And at what point does an adult child cease to really be seen as a dependent child?

The reality is that things are different today – child care costs, stagnant wages and stratospheric house prices all conspire to mean millennials in particular are in weaker financial straits than the Boomer generation.  It is fascinating how similar the American experience in this article is to the Australian one.

This also means that estate planning for different generations is different – a Will that is based on how things were 15 years ago is just not going to hold up.  Estate planning must contemplate these questions, and the differing degrees of need and dependence that exist in a family. Not only is each family different but the needs and requirements for who is looked after and how within the family vary from time to time. 

If your estate planning is based on a different time, or an outmoded state of play within your own circumstances, it is not going to do the job it was designed to do, and challenges and failures result.