Kathleen Burns Kingsbury returns to the podcast to share how financial professionals should prepare their clients to have a family money talk when preparing to pass down assets.

Kathleen Burns Kingsbury is not affiliated with Hartford Funds

You know, Julie, how many decades now have been have we been hearing about this tremendous transfer of wealth that’s going to happen in the tremendous opportunity for financial advisors to get in front of this wave of money that’s going to go from one generation to the next? And yet we think that that whole narrative misses probably the most important component, which is okay, if we know how the wealth is going to transfer, who takes care of the wisdom transferring to the next generation? Where did the where did the wealth come from? What does it mean to the family? What does it mean to those who are leaving it for the next generation? And what would their desires be, not just in the financial vehicles that it’s housed in, but how they would love to see it used by generations to come?

It is so true. I think we’re missing a key word, the wisdom. We’ve got the wealth, but we’re not talking about the wisdom. And I love how, Kathleen, in this episode that we’re about to listen to uses the analogy of, you know, in families, we talk about transferring important recipes. I know in my family, the Swedish pancake recipe is a treasured recipe. I’m the only one that knows how to make them for my grandfather. I will value that knowledge until the day I pass away, and I hope to pass that on to my niece and nephew. But we don’t necessarily pass on our money recipes. And I think that that’s just such a powerful way of looking at it. And I think that her framework of helping individuals think about the wisdom transfer is just incredible And empowering financial professionals to engage in that conversation with their clients is really eye opening.

And I think really valuable too, is because Kathleen is not only a thought leader, she’s a thought leader that works with financial professionals. And so I thought from this conversation, hearing exactly what the role is that financial professionals should play, a lot of us are like, Wow, that’s a great idea, but how do I approach this? I think she really gives you some good things to think about in terms of employing some of these techniques in your practice.

I couldn’t agree more. Very actionable. And I think that any financial professional listening could turn around and immediately have a great and engaging conversation with his or her clients based upon the guidance that Kathleen provides.

So, Julie, would you share with everyone exactly who our guest, Kathleen Byrnes Kingsbury, is on today’s podcast.

Yes. Kathleen Byrnes Kingsbury isn’t your average money mindset coach with over 18 years of specialized experience. She’s dedicated herself to empowering women across finance, business and entrepreneurship. Her expertise extends to working with financial advisors, helping them navigate the complexities of wealth management while fostering stronger client relationships. Recognized by The New York Times, The Wall Street Journal and others, Kathleen is the author of Breaking Money Silence How to Shatter Money Taboos. Talk More Openly about Finances and Live a Richer Life. Her most recent of five books on wealth, psychology and financial communication.

So let’s listen now as Kathleen shares with us how to transfer not only wealth, but help our clients transfer wisdom as well. Hi, I’m John.

And I’m Julie.

We’re the hosts of the Hartford Funds Human Centric Investing Podcast.

Every other week, we’re talking with inspiring thought leaders to hear their best ideas for how you can transform your relationships with your clients.

Let’s go.

Kathleen, welcome back to the Human Centric Investing podcast. We are so excited to have you here with us today.

Thank you, Julie. I’m excited to continue the conversation.

You know, Kathleen, we’ve done so much work with you over the years and it’s been very beneficial not only to our team, but really to many advisors and clients who had the benefit of kind of hearing your thoughts around identifying money stories and what’s important. And, you know, if you haven’t listened to the previous podcast that we did with Kathleen about your money story, I highly recommend you go check it out, look for it. But one of the things that we need to know about uncovering money stories, if you will, and having people tell us a little bit about how they got to where they are today in terms of their relationship with money. Is that, yes, sometimes there are challenging bits, but oftentimes, Kathleen, what I see is that clients identify really valuable lessons that they’ve learned along the way, either through people that they’ve known, their parents, grandparents or friends, and relative to other relatives, or maybe through money experiences that weren’t fun when they passed through them. But they learned really hard fought lessons along the way that that they’re very grateful that they learn now and they express a desire to pass those lessons on to the next generation, for better or worse. And it brings us to this topic, which you’ve coined as Family Money Talks. So can you give our audience kind of a broad overview of what a family money talk is and why in your practice you find that it’s so important?

Sure, sure. And I’ve certainly enjoyed all the work we’ve done over the years as well. Family Money Talk is really about when a family gets together and shares not only their values, their goals, their dreams, but really what their wishes are for the next generation. And believe it or not, I think it’s something like 67% of affluent families haven’t had this conversation with their children, adult children. And so when you don’t have a family money talk or a series of family money talks, what can happen is you can actually get in a situation. And I think some people who are listening can probably identify with this, where somebody dies or gets sick and you really don’t know what their wishes were. You don’t know how they would want you to spend an inheritance or handle a second home. And so you’re left kind of with all these questions. So if family Money Talk is consciously getting together and thinking about what are the values, what are their financial lessons and what are some of the things about our relationship with money or our money personalities? Do we want to overtly talk about with the next generation? And so that’s really what this work is about.

So, Kathleen, I’m picturing this conversation and it sounds like a very emotional and powerful conversation. I would imagine this is very different than the estate planning discussion, right, That that comes along with a legal document. And I would also imagine this might be different than, you know, sometimes the conversation of who gets this antique and maybe it’s this piece of jewelry or this piece of art. Correct me if I’m wrong, but are these very different types of conversations that a family might have throughout time as they’re sort of preparing the next generation?

Yes. It’s not running around and putting these little stickers on like I want.

Yes. Because I think sometimes we’ve all been through those, as painful as they may be. Yes.

A family money talk is really and again, it’s a series of conversations, ideally, but it’s really about passing down your wisdom. So think about it. The analogy that we use is a family recipe. Often family recipes get passed down. You determine at what age do you start teaching the kid how to make that famous lasagna grandma made. You pass down those ingredients. And then one of the things that happens over time is, you know, when grandmother is no longer with us, we are making the lasagna at a holiday in memory of her. So it’s a family recipe, except for it’s a recipe around money that gets passed down. And one of the things that I think is really important to keep in mind is, well, maybe parts of that family money talk maybe more serious. A lot of it can be fun and enlightening and help families connect and really discuss, you know, what is it that they learned about money? What is it that they wish for? The kids, you know, what were their successes? So there’s a lot of pieces to it that don’t have to be somber or and they’re not always just about death and dying. It’s often about, you know, what are our values? How do we use our financial resources to express those value values and what do we hope for you? And I think a lot of times the next generation is relieved when the parents bring it up because it’s on their minds.

You know, Kathleen, it sounds so much better when you talk about a family recipe versus having the talk, right? Yes. Sure. Mom or dad coming in at Christmas and everybody celebrating and somebody goes, okay, kids, time to talk about the estate plan.

Were you at my house? Because my dad used to do that every Thanksgiving.

Well, I guess I guess my question is, before we encourage financial professionals to get involved with this, maybe you could identify for us some of the reasons why maybe older generations shy away from having this talk with younger generations and maybe why younger generations don’t inquire of older generations about this topic? Like, why is it in your experience that people tend to avoid these things unless they’re encouraged through the example of like a family recipe?

Sure. I think that when you look generationally just at how people talk about money or don’t talk about money, I call it money silence when people aren’t talking about money. The older generations are traditional traditionalists. Baby boomers were often raised that it was rude or unnecessary to have these conversations. And often when you’re dealing with somebody who’s the matriarch or patriarch of the family, they were raised at a time where that didn’t happen. And there’s also this belief that a family money talk is about dollars and cents. That is really about how much you’re inheriting, who’s inheriting, you know, why am I giving it to charity and not you? And it really isn’t about that. It is about passing on the wisdom that you have learned over your lifetime around finances, around managing money from a technical aspect, but also from an emotional aspect. And, you know, I think for younger generations, there’s still a taboo against talking about money, but it’s not so strong. What’s exciting is, as I’m doing the second edition of Breaking My Silence and I’m updating it right now, I’m finding that we’ve made progress in this area. I think for younger generations, they have witnessed what it’s been like for their parents to not have those money talks with, you know, their grandparents. And the result of that and I think next Gen really wants to build that into their financial plan really has questions. You know, mom, dad, do you have insurance? Do you have long term care? Do you, you know, want anything in particular? As we age, you know, in terms of philanthropy. So I think we are moving in the right direction. I think financial advisors play a critical. A role in strongly encouraging families to engage in these conversations, whether it’s the adult child approaching mom or dad, or whether it’s mom and dad talking to maybe their kids and their grandkids.

So, Kathleen, if I’m hearing you correctly, these stories, conversations, life lessons, learnings can happen without all of the statements coming out and necessarily, you know, all of the zeros attached to the statements don’t necessarily have to be shown alongside of all this. If a family isn’t ready to divulge that with the next generation, is that correct?

Absolutely. In fact, I encourage this type of conversation before you ever get to the numbers. And so there are so many individual factors as to when, where and how you’re going to talk about what those numbers are going to look like, that it’s really this is about really building an open line of communication. So by the time you get to those numbers, you’ve already had so many money talks about all sorts of other things that aren’t about the dollars and cents that by the time you get to talking about the money, it becomes so much easier. But no, if it in fact, it’s ultimately up to whoever initiates the money talk and say, in this case, it’s the parents. It’s ultimately up to them if if they’re going to share the numbers or not. But don’t let that scare your clients away, because that is not what it’s about.

You know, Kathleen, the one way Julie and I have talked about it and talked about it with you is that since I joined the industry 30 plus years ago, we’ve been talking about this multibillion dollar generational transfer of wealth. But nobody’s asked the question about when the wisdom transfers. Right. So we’ve got the estate plan nailed down, but the kids knew nothing about it until they show up in the attorneys office and then they’re trying to make heads or tails of it. So I guess my question is, if you have a client that is kind of knows this is an issue, they want to kind of take part in it, I would imagine it’s pretty important for the person initiating the money talk to have done some pre-work themselves right to identify what it is they want to talk because my guess is if you go into this talk without a real good idea of the kind of things you want to talk about, you might revert back to the numbers because you don’t know what else to talk about, right? Do you find that walking people through certain exercises is almost a prerequisite of having a family money talk?

Yeah, I think there’s a way to do it in a structured way that makes the advisor feel comfortable and helps the family understand kind of what are we in for or what what kind of information should we be talking about? I think what’s important and we haven’t mentioned yet is that 60% of intergenerational wealth transfers fail because of failure to communicate about money and passing on this wisdom. It isn’t the legal or the technical aspects. It really is this wisdom piece we’re talking about these family money talks. And so what I encourage families to talk about and advisors to kind of introduce these different exercises to families is around three different areas. So there’s financial intelligence, there’s emotional intelligence. And there’s also did I already say family? It’s financial, emotional and family, sorry. And so basically with those three types of intelligence is there’s different exercises. So I don’t know if you want me to define those or.

Maybe some definitions be helpful. Sure.

Right.

Yes, sure. So when we look at financial intelligence, that’s the one we tend to think about the most, right? That’s financial literacy, teaching the next generation how to make manage gift, invest money so it’s more concrete. When we look at emotional intelligence, we’re looking at the human side of finance, which is that we all have a certain money personality. We have different money stories, we have a different relationship with money. And that impacts how we are making these financial decisions. Sometimes it impacts us positively, sometimes it impacts us negatively. But with the emotional intelligence piece, it’s becoming aware that there’s this whole behavioral finance piece and there’s psychology around money and how to use that to your advantage. So in addition to the technical aspects adding on the insight into your relationship with money. And then the third component is called Family intelligence. And Family intelligence is about values. It’s about our success story to family. What do we do right in terms of our relationship with money and saving for the future? It also includes where do we mess up and what did we learn from that and what are our hopes that the next generation will take away from these money mistakes? The reason we share both successes and mistakes is because we don’t want people to feel ashamed if they aren’t perfect around money because nobody is. So the advisors can really zone in on one or all three of those areas in encouraging families to have these types of conversations.

Are there questions specifically that you find are helpful or any tools that financial professionals can use to, again, aid their clients in sharing these family money recipes, if you will? You know, I would imagine, again, for a family that hasn’t dipped their toe into these conversations to, you know, gather the family around and to begin this probably feels like a little bit of a daunting task. How do you guide financial professionals to guide their clients?

I coach the advisors to first talk to their clients, so let’s assume it’s a couple. So what I would say is I would introduce the concept of what a family money talk is. I would explain that there are these three different types of intelligence. Is this wisdom that you want to pass down in the next generation and define those and then give the couple an option? You know, I think we can address one of these, you know, would you like to focus on the financial literacy, the emotional intelligence or the family intelligence? And within that, there are different exercises and different questions which I can cover in a minute. But it isn’t to, you know, immediately gather the family together and everybody sit down and the advisor has to deal with all those people staring at them. It’s really talking to your clients, figuring out what they think and believe about these different areas of their life as it relates to finances and then figuring out how do they then communicate that to the next generation. It could be the advisors involved and a lot of advisors are getting involved. It also could be that this becomes some of their homework that they go off and do and come back and report back to the advisors. So there’s a lot of different ways in which this can work.

That’s very helpful, Kathleen. That was going to be my next question, which is that the role of the adviser. So what you’re saying is I may as the advisor not be present at the actual family money talk. I may be present, but I may be kind of coaching from the sidelines, encouraging and and listening to the feedback and suggesting or guiding the client through the conversation. I think that’s really helpful to think about is determining what role our client would like us to play and not just necessarily inserting ourselves, but really introducing the concept and, and seeing if they’re interested in and in what areas are they interested. I guess, you know, the question I have is so the client, the family money talk, we know that families are not always neat and proper. Right. It’s not always.

They’re never.

Improper. 2.3 children, two dogs in the backyard. Right. Living in the country. Estate, families, all families have issues. Right. And there may be there may be certain family members that are not ready for a family money talk necessarily. Do you do you often see is it a mixed bag whether we meet with the family as a whole or can these are there things to be careful of? If we have individual conversations, let’s say let’s say I have three children, would I address individually with each child based on where I think they’re at? Or do I have to be careful of that? I don’t want to build resentment between them. Kind of what having done this for so long, what do you recommend in terms of structure when it comes to families that aren’t so neat and tidy as we would like to think?

I think what is important is to recognize that the client gets to decide based on their family dynamic what’s going to make sense. And so the most important thing to do or to not do is we don’t want secret keeping. So we want to think about if we talk together as a family, what that might be like and would that be the most productive way? Or if we were to maybe initially in your case, talk to each of the individual kids separately and then maybe eventually bring everybody together. Is that the best way? What is really important, though, is that parents don’t tell one kid one thing and the other kid the other thing. And there’s secret keeping. Now, that happens in families all the time. And it’s a way of avoiding conflict. Like if we don’t, you know, if we if we just tell Johnny this and Susie that, then maybe we’ll keep the peace. Well, what ends up happening is eventually they find out there was a secret and it blows up. So it really is thinking through what makes sense for you and your family. And an advisor can also ask some questions, just like, you know, we just are talking about now. Like, what do you think makes sense? Why do you think that makes sense? And if it gets really complicated, you know, with very mixed dynamics, or maybe there’s a child that is it has an addiction issue or there’s some other, you know, really complicated dynamics, that’s when you would pull in somebody like a family wealth consultant that would really work with the advisor and the family to do that process. So it really runs on a continuum. But the bottom line is try very hard not to keep secrets because that ultimately is not useful for successfully passing down wealth in a way that’s going to make sense for everybody.

By the way, Kathleen, I don’t know if you’ve seen this, but I certainly have. Sometimes we think that because people have money and sometimes because people have a lot of money, that they don’t have problems within the family. And I can share, Oftentimes those problems almost multiply based on the wealth the family has. So certainly something to be mindful of.

Absolutely. I think the thing with having a large amount of wealth is that you are tied together to your family members in a way that you wouldn’t be if you didn’t like. We all go off. I was raised middle America. You all go off. You start your own homes, your own families, and no longer are you making financial decisions with your siblings or with your dad or your mother. And so when you have that level of wealth, you often through a family business or through some sort of real estate dealings, often are in trust. So you often are connected in a way that isn’t what’s typical. And yes, it can be very complicated. And those are instances where I do think having a professional that focuses in on family money talks in consulting with that situation makes a lot of sense.

Kathleen, I’m curious, just given your breadth and depth of experience and expertise, what advice would you give a financial professional who’s listen to this today and says, you know, I’m not sure that these conversations are really in my purview or this is maybe a little bit outside of the scope of what I deliver. Just based upon the power of what you’ve seen and how this transpires. What would you say to him or her that maybe is of that mindset after listening to what we’ve talked about today?

Sure. And I understand somebody that’s saying that, especially as somebody who’s been in the field a long time, this part of the business is newer. I would say that if you are interested in keeping the next generation’s assets, that 90% of next gen leave for the parents advisor and this is a way to start the relationship and to get to know the next generation. And they are more likely if they have a connection with you and you’ve facilitated these family money talks to stay with you. So there’s a business reason for doing so. I also think that often when we’re fearful of engaging our clients in these in these conversations, it could be about how we feel in our own family. And so it really is looking at, are you willing to do a little bit of this work yourself in your own family to then see what it’s like to experience it and then decide if you’re going to add this to the mix? There are strong business reasons for doing so. Once you do it, you become more practiced at it. It becomes less scary. And I also think there are trainings out there nowadays that allow you to really become more aware of the behavioral finance piece of what financial therapy is. And if you want to delve into it, you certainly can. The last thing I’ll say is there’s get guardrails, right? So you get to set your own guardrails around how deep I go into the family money talks with my clients. But I do strongly believe that it’s in a financial advisors purview to at least introduce the concept and let them know why it’s important, because if they want to help their clients successfully manage and pass down wealth, then this type of passing down wisdom is essential to them being successful in their job description. So, you know, you can set where you’re going to be in that, but at least introducing the concept and the ideas I think is really definitely within the job description.

I think it’s a great spot to kind of end up this discussion. Kathleen But before we let you go, we talked a lot about family money talks. We now want to have a Kathleen talk not about money, but through something we call the lightning round. We’re going to fire some top of mind questions at you. Just to get your instant responses so that our audience can learn a little bit more about Kathleen, just as families are going to learn a little bit more about their money history through the talks that we just discussed of your game. We’ll fire a few questions at you and see how it goes.

Sure. I’ll give it a try.

What’s your favorite holiday?

Christmas. And well. Nope. Going to change my response. My birthday. That’ll show you a little bit of narcissism. But it’s my birthday and I celebrate for like weeks on end.

I think that’s only appropriate. I think everyone should have the birthday month personally, but that’s just me.

Kathleen, I know we’ve crisscrossed in several U.S. cities over the past few years. What’s your favorite city in the United States?

That’s easy. I love Chicago.

Excellent.

Yeah.

When you were a kid, what did you want to be when you grow up?

I wanted to be an engineer like my father.

And kind of hinging on that question, what was your favorite board game as a child?

I’m trying to remember the name of it. Is it the Chutes and Ladders? Chutes?

Chutes and Ladders or Candyland?

I know I’m dragging this out a bit, but now it’s my Payday, which is interesting because I now work with women around how they can ask for what they’re worth. But yes, payday. I think I like the money and I like being the banker. So that’s. There we go.

I like that.

Awesome.

Would you rather travel to the past or to the future?

I like the here and now. Can that be my answer?

I think it can. This is all about you.

Yeah. Excellent.

Kathleen, my last question. Are you a morning person or a night owl?

Morning person.

And what was the first concert you went to?

So embarrassing because it’s not that brilliant. But I went to Billy Squier. I don’t even know if it’s nice.

I love Billy Squier.

Obviously has been went to Santana though. That’s really cool. But really Squier.

Billy Squier is cool. Back to the day. Kathleen Come on.

Thank you, John. Yeah.

I’m right there with you.

I don’t know who that is. I’m going to.

Ask.

Kathleen, thank you again for joining us today and sharing your insight and wisdom with our listeners. And for those listening, if you would like more information on Kathleen and her work, feel free to visit her website at cbc.ca. Well of connection.com. Or you can find her on LinkedIn at Kathleen Burns Kingsbury or on Facebook at. Breaking money Silence. Kathleen thank you again for sharing your insights and wisdom with us today.

Thank you very much. I’ve loved having this money talk with you and John.

Thanks for listening to the Hartford Funds Human Centric Investing podcast. If you’d like to tune in for more episodes, don’t forget to subscribe wherever you get your podcasts and follow us on LinkedIn, Twitter or YouTube.

And if you’d like to be a guest and share your best ideas for transforming client relationships, email us at guest booking at Hartford funds.com. We’d love to hear from you.

Talk to you soon.

The views and opinions expressed herein are those of the guest who is not affiliated with Hartford Funds.