Most people know the basics of building financial security include saving consistently, investing for growth, managing debt and preparing for retirement.
The challenge facing many Americans is that financial strategies tend to focus on numbers while overlooking something equally important: Family communication.
Lincoln Financial’s latest Consumer Sentiment Tracker found that 78% of families surveyed haven’t had an in-depth conversation about life insurance, for example. It also found that 60% of adult children believe their parents have life insurance coverage in place, while only 44% of parents say they do.
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The disconnect extends beyond life insurance. Similar gaps exist around retirement income, healthcare costs and wealth transfer.
What I find interesting isn’t just the data. It’s what it reveals about how families approach a financial strategy.
Many people assume critical decisions have already been discussed. They assume their spouse understands the decisions that have been made. They assume their children know where important documents are. They assume their parents have taken care of everything.
Sometimes those assumptions are right, but often they’re not.
That’s why I believe financial protection starts with conversation.
Why communication is becoming more challenging
Today’s families are juggling more financial responsibilities than ever.
Many adults are trying to save for retirement while helping children through college. Some are supporting aging parents while managing mortgages, careers and their own long-term goals. Others are navigating questions about healthcare, caregiving and legacy at the same time.
As financial realities become more complex, communication becomes more important. Yet this is often the first thing to get postponed.
Nobody wakes up on a Saturday morning excited to talk about life insurance, healthcare costs or estate decisions. These conversations can feel uncomfortable. They can feel premature. Sometimes they can even feel unnecessary.
After all, if everything seems fine today, why bring it up?
The problem is that many financial decisions don’t become important when they’re made. They become important years later.
The families that seem most confident in their financial decisions aren’t necessarily the ones with the largest portfolios or the most sophisticated strategies. In many cases, they’re the families that have created clarity around who is responsible for what, what protections are in place and what they want their future to look like.
Life insurance awareness starts with creating clarity through conversation. That may sound simple, but many families still haven’t taken that first step.
Life insurance is part of a bigger financial picture
One of the reasons life insurance gets overlooked is because people often think about it separately from the rest of their financial strategy.
Retirement preparation goes in one bucket, investments go in another, and insurance sits somewhere else.
But in reality, every financial decision is connected.
The amount of risk someone is willing to take in an investment portfolio may depend on the protections they have elsewhere. Meanwhile, healthcare needs, estate planning considerations and family obligations can all affect the type of financial protection that makes sense for a specific situation.
That’s why I’ve long believed life insurance should be considered alongside saving, investing and preparing for retirement as part of a comprehensive financial strategy.
It’s important to ask whether someone’s overall strategy reflects the life they’re building today and the responsibilities they want to prepare for tomorrow.
A family with young children may have different priorities than someone approaching retirement. A business owner may need different protection than a salaried employee. Someone caring for aging parents may face entirely different financial considerations.
The goal isn’t to arrive at a universal answer.
The goal is alignment between financial decisions and financial realities.
Moving from assumptions to informed decisions
The good news is that closing the conversation gap doesn’t require a complicated financial approach.
Most families don’t need to start with spreadsheets, policy reviews or legal documents.
They need to start with goals.
Ask questions like:
- What are we trying to protect?
- Who depends on us financially?
- What would happen if one source of income disappeared?
- Are there responsibilities we haven’t accounted for?
- Does everyone understand the decisions and protections in place today?
Those questions tend to open the door to more meaningful discussions about financial protection, retirement goals and long-term priorities.
From there, families can begin identifying areas that need more attention and move from assumptions to informed decisions.
Five ways to close the conversation gap
1. Treat life insurance as part of your financial strategy
Review life insurance the same way you’d review retirement accounts, investments or estate documents. Financial protection deserves a seat at the table alongside every other major financial decision.
2. Identify who’s impacted
Financial decisions rarely impact just one person. Consider spouses, children, aging parents, business partners or anyone who depends on your financial wellbeing.
Talking across generations helps create a shared understanding of responsibilities, priorities and expectations before important decisions need to be made.
3. Start with goals, not policies
People connect more easily to conversations about family, security and future priorities than they do to policy features or coverage amounts.
Focus first on the people and goals you’re trying to protect. The technical details can follow.
4. Check assumptions against reality
Ask yourself what you’re assuming to be true. Then verify it.
- Do family members know where important documents are located?
- Have beneficiary designations been reviewed recently?
- Would the people who matter most know what steps to take if something happened tomorrow?
Assumptions are often where financial gaps begin.
5. Bring a financial professional into the conversation
A financial professional can help evaluate protection needs, identify blind spots and ensure life insurance is viewed within the context of a broader financial strategy.
Their role isn’t just to recommend solutions. It’s to help create clarity and guide informed decision-making.
A better way to think about life insurance
Lincoln’s research suggests that for many families, there are important financial conversations left to have. The issue isn’t a lack of interest in protecting loved ones. Most people care deeply about that.
The issue is that many families have never confirmed whether everyone’s understanding of the family’s financial decisions and protections matches reality.
Closing the conversation gap won’t solve every financial challenge, but it can help families create clarity before it becomes urgent.
And it can help ensure life insurance plays the role it was intended to play from the beginning: Helping protect the life families are building today.
The conversation doesn’t have to be perfect. It just has to start.
Lincoln Financial is the marketing name for Lincoln National Corporation and its affiliates, including issuing insurance company The Lincoln National Life Insurance Company, Fort Wayne, IN, and wholesaling broker-dealer, Lincoln Financial Distributors, Inc., Radnor, PA. LCN-9117890-090926