For the past number of weeks, people have been busily preparing for the holiday season. Best wishes have been regularly exchanged, gifts have been purchased, meals have been planned, and folks look forward to a time of celebration and rest. In an ideal world, the holiday season should be filled with relaxing quality time with friends and family.

In reality, the holiday season can be a stressful time for many families. Family dinners and holiday events can often feel like a powder keg of tension between strong personalities and complex relationships. The classic cliche of the family sitting down to Christmas dinner just hoping that everyone can navigate a few hours without any controversy is all too real for most. How many Christmas movies have been inspired by this theme of another ruined Christmas dinner due to the ill-timed airing of grievances?

In wealth management, we are often involved in helping families navigate some of the most challenging questions that strain relationships. How will caregiving for our aging parents be financed? What is going to happen to the family cottage when grandma and grandpa are gone? What happens to the family business when one brother has earned his place working up from the shop floor while the other brother went surfing and snowboarding through his 20s? How do we protect the family wealth from any future ex-spouses of our siblings or children? These are all tough but essential conversations.

The fact is that very few families have perfectly smooth family dynamics. Most families have a series of issues that are causing strain on the relationships that often get neglected year after year without ever being adequately addressed. These are difficult conversations because the issues are important, the people care, and the outcomes impact all those involved in profound ways, yet the solutions are not obvious.

In wealth management, we can typically look at any wealth management scenario and model the textbook solution that minimizes taxes, maximizes investment performance or family wealth, and conveniently navigates the issues with ease. In the real world, wealth management is about people and what they want out of life, and people are complicated, imperfect, and unique. Beyond the textbook wealth management strategies there is always the nuance of reality, that one aspect that changes everything when understood in the context of family history. So often these nuances are ignored when professional advisors chart the “correct” path forward for the family.

For many families, the holiday season is the only time during the year when the entire family, with all interested parties, is in one physical location. It makes perfect sense that it can become a stressful time as family members attempt to give voice to the issues resting heavily on their minds. Those wealth management issues that are causing tension and looming under the surface of polite family interactions are bound to come out in unpredictable ways when everyone is together.

Worse yet is the approach of simply ignoring the critical issues year after year until it is too late. The will and estate documents are never updated. The succession plan for the cottage is never discussed. The older sister continues to feel resentful for always being the one showing up to help their aging parents. Dad continues to get older without transferring control of the family business even as his cogitative capacity declines. Often in wealth management, we see situations where simple adjustments years ago could have solved much more significant challenges today had they only been discussed openly. So this year, perhaps it is time to have those difficult discussions in a controlled and healthy way.

In my wealth management practice, I try to remind my clients that the first step is to always establish the “why” before developing the “what” and “how”. What are we trying to accomplish? What is important to you and your family? What makes your situation unique? What are your fears and challenges in life? What keeps you up at night? When in doubt, ask the questions again in different ways until we have a complete understanding. Wealth management decisions and strategies are to serve the needs and desires of your specific family and not the other way around.

If you believe that your family needs to have some difficult conversations around wealth management, then I would encourage you to move forward assertively but with caution. To help with this, I have assembled some guidelines to ensure such decisions are respectful and productive.

Breakout of avoidance mode - Often the temptation is to avoid difficult family discussions year after year. The path of least resistance is to ignore the developing problems until they become big problems that are confronted by natural consequences. In reality, the earlier that difficult issues are identified and discussed the greater the range of available solutions. Having awkward discussions now is most definitely better than struggling with a more difficult reality in future years.

Allocate a specific block of time - Setting aside a specific block of time to have challenging family discussions can help everyone focus on the issues. If everyone knows that a family conference is happening on December 27th at 1:00 pm, then everyone can keep things positive during the family dinner on Christmas Day. The family conference should be at a time when all the stakeholders and decision-makers can be fully present. Nobody is skipping the meeting to chase a Boxing Day sale. Child care is addressed so that parents of young children can participate without interruption. Cellphones and other devices are set on silent mode and left in another room. People are rested with clear minds, ready to talk and listen.

Have an agenda and a Chairperson - Stressful conversations between people with opposing interests need structure and boundaries to keep discussions productive and respectful. If everyone knows what issues are at hand then they can have time to formulate their ideas and concerns in a respectful way. The Chairperson should ideally be someone with minimal bias who everyone trusts. If appropriate, the family might even consider a neutral outside third party to fill this Chairperson role.

Discovery - Discovery is the process of exploring the real issues at hand before any solutions are suggested. It is a period of extensive questioning where we attempt to draw out the various layers and complexity in our understanding and outline the real problems. Have we considered it from all angles? What are the real fears and desires underlying the communication expressed on the surface? Is there common ground that can be used as a starting point? Sometimes what is discovered is more alignment than what was initially perceived.

Empathy, Empathy, and more Empathy - The key to building any form of human relationship is empathy, both demonstrating empathy towards others and observing the empathy that others have towards you. In wealth management, we learn this, but it applies to family relationships even more. Asking many questions to understand someone else’s point of view helps to build your sense of empathy toward them. Asking others to explain their perception of your perspective can also help you receive empathy from others.

Know that your family challenges are not unique - All families face challenging issues. We all have that cousin Eddie who disrupts everything. We all have a patriarch or matriarch who is reluctant to engage in meaningful discussions about the future family dynamic and remains in the memory of a past era. Many of us have that in-law who we would rather not have at the negotiating table. No matter what the problem is, other families have successfully navigated similar challenges. Always remember this.

Conclude the meeting with a path forward - Never close discussions without agreeing to some sort of map for the next steps. This does not mean that final decisions need to be made in a single session, but rather a road map for future discussions must be understood by everyone at the table. Set out an agreement of who is responsible for which actions and set a time and place for the next meeting. Finally, once this is achieved properly adjourn the meeting and stop discussing the issues. Avoid side discussions that might develop into resentment. Instead, allow the thoughts to settle and bring your new thoughts to the next meeting.

One of the great privileges of our work in wealth management is that we have the opportunity to use our knowledge to help families navigate the challenges of life. We can unlock real value by framing discussions and outlining a feasible plan that can have a profound impact on the quality of life for the entire family. Addressing the most challenging tensions in family dynamics is where the most significant gains are made. It is my sincere wish that your family can use these guidelines to help address the challenging conversations that need to happen.

I hope that you have a wonderful time celebrating and resting with your family during this holiday season. I wish you all the best of happiness, health, and prosperity in the coming year.