When Canadians contemplate their legacy and the wealth they’ll leave behind, financial figures and estate values naturally come to mind. However, beneath the spreadsheets and legal documents lies a complex emotional terrain that often exerts far more influence over major decisions than most people recognize. The process of passing on wealth to the next generation is rarely a purely rational, numbers-driven exercise. Instead, it’s deeply colored by emotions—a potent mix of hope for the future, pride in what has been accomplished, and a healthy measure of anxiety about whether things will unfold as intended.
These powerful emotions don’t just influence how people think about their legacy; they actively guide major decisions around wealth transfer. Perhaps more significantly, these same emotions can create substantial barriers to the frank, open dialogue that needs to happen between aging parents and their adult children if wealth transfers are to proceed smoothly. This dynamic has been examined in a recent report from BMO Private Wealth, which highlights the emotional complexities that frequently complicate what should be straightforward financial planning conversations.
The Communication Gap Between Generations
According to the BMO Private Wealth report, several specific factors contribute to communication breakdowns between generations when it comes to inheritance planning. “Differing values, financial literacy levels and expectations around inheritance can create tension and avoidance,” the report explains. Each of these elements deserves closer examination, as they represent distinct challenges that families must navigate.
Differing values between generations can manifest in numerous ways. Parents who built their wealth through decades of hard work and careful saving may have fundamentally different perspectives on money than children who grew up with greater financial security. What one generation views as prudent financial behavior, another might see as overly cautious or unnecessarily restrictive. These value differences can make it difficult to have productive conversations about wealth because the underlying assumptions and priorities don’t align.
Financial literacy levels vary widely not just between generations but within them. Some adult children have developed sophisticated understanding of investments, tax strategies, and wealth management, while others have limited knowledge of these areas. Parents may worry about overwhelming less financially savvy children with complex information, or conversely, they may feel uncomfortable discussing financial matters with children who know more than they do. These literacy gaps can create awkwardness that leads to avoidance rather than engagement.
Expectations around inheritance represent another potential minefield. Parents may have certain ideas about what constitutes a fair or appropriate inheritance, while children may have formed entirely different expectations based on limited information, assumptions, or conversations with peers about what they’re receiving from their own parents. When these expectations don’t align with reality, disappointment and conflict can result.
Shelley Forsythe, who serves as director of family enterprise planning at BMO Family Office in Vancouver, identifies a specific emotional barrier that frequently prevents open communication: “Parents often feel fear around financial disclosure.” This fear can stem from multiple sources. Some parents worry that if their children know how much wealth exists, it will reduce their motivation to work hard and build their own careers. Others fear that knowledge of a substantial inheritance might lead to irresponsible financial decisions in the present, with children spending freely in anticipation of future wealth. Still others simply feel uncomfortable discussing money, viewing it as a private matter that shouldn’t be shared even with close family members.
The Costs of Avoidance
When families avoid open discussions about wealth transfers, the consequences can be significant and far-reaching. Estate plans may be structured in ways that don’t actually align with the family’s needs or the parents’ true wishes, simply because the necessary conversations never happened to clarify what everyone wants and needs. Adult children may make life decisions—career choices, major purchases, retirement planning—based on incorrect assumptions about what inheritance they can expect. When the reality eventually becomes clear, often at the reading of a will after a parent’s death, the results can be both financially and emotionally devastating.
Family relationships can suffer permanent damage when inheritance outcomes surprise people. A child who expected to receive the family business but learns it’s being sold instead may feel betrayed. Siblings who assumed assets would be divided equally but discover unequal bequests may suspect favoritism or question their parents’ love. These wounds can take years to heal, if they heal at all, and the person who made the decisions—the deceased parent—is no longer present to explain their reasoning or help mediate the conflict.
This is where skilled financial advisors can make an enormous difference. With the right tools and approach, advisors can play a pivotal role in facilitating these challenging discussions before problems arise. However, as Forsythe emphasizes, this requires more than just financial knowledge and technical expertise. “You need to balance the IQ [intelligence quotient] and EQ [emotional quotient] to make sure you can have really good conversations,” she explains.
Reading the Room: Emotional Intelligence in Practice
Intelligence quotient refers to the technical knowledge that advisors bring to their work—understanding of tax laws, investment strategies, estate planning mechanisms, and financial products. This IQ component is essential, but it’s not sufficient on its own. Emotional quotient encompasses the interpersonal skills, empathy, and psychological awareness that allow advisors to navigate the human dimensions of wealth planning.
John Tabet, who works as a portfolio manager and senior investment advisor at iA Private Wealth Inc. in Oakville, Ontario, describes how emotionally adept advisors watch for subtle cues that reveal where sensitive issues lie. These professionals don’t just listen to the words being spoken; they observe the complete communication picture, including what isn’t being said.
“Maybe it’s body language or what simply isn’t said. Sometimes, it’s a quick, knowing glance between spouses, and I’ll think, ‘That hit a nerve.’ So, let’s explore that a bit,” Tabet explains. This kind of attentiveness requires advisors to be fully present in conversations, watching for physical tension, changes in tone, sudden silence when certain topics arise, or the meaningful looks that couples exchange when a particularly fraught subject comes up.
When advisors notice these emotional signals, they have an opportunity to gently probe deeper, creating space for clients to express concerns or fears they might not volunteer on their own. This careful, observant approach helps bring hidden issues to the surface where they can be addressed rather than allowing them to fester unacknowledged.
The Foundation of Effective Wealth Transfer
Communication serves as the fundamental building block not just between advisors and clients but also between parents and their children. Tabet emphasizes that while the advisor-client relationship depends on open dialogue, advisors also have a responsibility to help clients understand why they need to communicate with their children about legacy intentions.
When this communication doesn’t happen, uncertainty rushes in to fill the void. Adult children may speculate about their parents’ wealth, make assumptions based on incomplete information, or simply avoid thinking about it altogether because the topic feels taboo. Then, when parents pass away and the will is read, reality intrudes—often in ways that shock and confuse.
“A lack of communication leads to the kids receiving an inheritance that’s larger or smaller than expected, and they’re left asking why,” Tabet notes. These “why” questions can haunt families for years. Why did my parents give more to my sibling? Why wasn’t I told about this asset? Why did they make these choices? Without the parents present to answer, children are left to speculate, sometimes arriving at painful conclusions about their parents’ feelings toward them or their judgment of their life choices.
The Paradox of Parental Hopes and Fears
The emotional complexity of wealth transfer stems partly from the contradictory hopes and fears that parents harbor about their legacy. Sonia Park, who works as a private wealth consultant and vice-president at RBC Wealth Management in Toronto, regularly encounters this emotional paradox in her work with clients.
Parents universally hope that the wealth they’ve accumulated will provide security for their family members, giving them opportunities and protecting them from financial hardship. They also typically hope that shared family wealth will serve as a unifying force, bringing family members closer together through shared resources and common financial interests. However, simultaneously, many parents harbor deep worries that wealth will actually drive their family apart rather than bringing them together.
These fears aren’t baseless. Wealth can create jealousy, entitlement, and conflict. It can reduce motivation and create dependency. It can lead siblings to fight over assets or question their parents’ fairness. Parents who have witnessed these dynamics in other families—or perhaps experienced them in their own extended families—naturally worry about whether their own wealth will ultimately help or harm their children’s relationships with each other.
Park frequently helps clients work through these competing emotions, emphasizing the critical importance of planning to navigate both the challenges that clients perceive and those that genuinely exist. Simply hoping that everything will work out, or avoiding the issue because it creates anxiety, rarely leads to positive outcomes.
Education and Governance as Solutions
Part of Park’s approach to addressing these challenges involves educating the next generation about the family’s wealth. This education goes beyond simply telling children what assets exist or what they might inherit. It involves helping them understand how the wealth was created, what responsibilities come with it, what values the family wants to preserve, and how to manage wealth wisely.
For families where the next generation lacks strong financial literacy, this educational component becomes even more crucial. Park works to bolster their understanding of financial concepts, investment strategies, and wealth preservation techniques so that when they do inherit, they’re equipped to manage those resources effectively.
“Another area I focus on a lot is helping families establish governance. Basically, that establishes guidelines for how families make big financial decisions together,” Park explains. Family governance structures can take various forms, from informal family meetings to formal family councils with written charters and voting procedures. The specific form matters less than the function: creating clear, agreed-upon processes for making major decisions that affect the family’s shared wealth.
These governance structures serve multiple purposes. They provide a framework for communication, ensuring that important conversations happen regularly rather than only during crises. They clarify roles and responsibilities, so everyone understands who has authority to make different types of decisions. They establish decision-making processes that feel fair to all involved, reducing the potential for conflict. And they create mechanisms for resolving disagreements when they inevitably arise.
Park also recognizes that families can easily become overwhelmed when confronting these complex issues all at once. She uses what she describes as a volume dial approach to managing the pace and intensity of these discussions. “It’s like a volume dial, where you start low and, as you get more confident, you can share more,” she says. This gradual approach allows families to build comfort and competence over time rather than forcing them into high-stakes conversations before they’re ready.
When Professional Help Is Needed
Despite the best efforts of skilled financial advisors, some family situations involve emotional dynamics that are simply too complex or charged for advisors to navigate on their own. In these cases, bringing in specialized third-party assistance becomes necessary.
In Winnipeg, advisors working with high-net-worth clients frequently call on Moira Somers, a psychologist and family wealth consultant at Blackwood Family Enterprise Services. Dr. Somers brings psychological expertise to family wealth situations, helping families work through emotional issues that extend beyond the financial realm.
The emotionally thorny situations that require this level of specialized intervention can take many forms. Sibling rivalries that originated in childhood may resurface with renewed intensity when inheritance is at stake. Dysfunctional blended families, where relationships between step-siblings or step-parents and step-children carry existing tension, may find that wealth decisions amplify existing conflicts. The challenge of dividing a family business—determining who will take over operations, whether some family members will be bought out, how to value the business fairly—can be particularly fraught because it involves not just money but also legacy, identity, and relationships.
Dr. Somers emphasizes that while these issues aren’t insurmountable, successfully working through them demands significant time and patience. Quick fixes rarely address the underlying emotional dynamics that create problems. “Where there has been a lot of conflict, there can be good reasons. You need to iron out the issues well ahead of time rather than hoping everyone will be on the same page,” she advises.
This perspective highlights a crucial truth about wealth transfer planning: the emotional work cannot be rushed or avoided. Hoping that family members will magically align when the time comes, or that conflicts will resolve themselves, is wishful thinking that often leads to disappointment and family fracture.
The Ultimate Goal
By coming to the emotional rescue—helping families navigate the psychological complexities of wealth transfer—advisors play a pivotal role in successful legacy planning. However, the goal extends beyond simply ensuring that assets transfer efficiently from one generation to the next or that tax consequences are minimized.
As Park observes, “Every family seeks to maintain harmony.” This harmony represents the true measure of successful wealth transfer. Yes, the financial mechanics matter. Tax efficiency, legal structures, and investment strategies all deserve careful attention. But if the wealth transfer process damages family relationships, creates lasting resentment, or leaves family members estranged from each other, can it really be considered successful?
The most effective wealth transfer planning recognizes that money is never just about money. It carries emotional weight, represents family history and values, and has the power to either strengthen or fracture relationships. Advisors who understand this truth and possess both the technical knowledge and emotional intelligence to address it can help families achieve something more valuable than wealth preservation alone: they can help preserve family bonds across generations.
Acknowledgment: This article was written with the help of AI, which also assisted in research, drafting, editing, and formatting this current version.
