Network Estate Planning

In our ever-changing world, marketing methods, client-relationship strategies and selling techniques seem destined to continually evolve.  While some age-old methods for achieving success may never become outdated, acquiring and offering better products and improved delivery systems are essential progressive strategies.  The 80's office manager who did not understand all of the hype over the new fax machine would deem it laughable to be without one now.  Who would have guessed, not many years ago, how computers would be impacting our lives today?  Change is not only is also necessary.

The Diversification of Financial-Related Services
It is an undeniable fact that the demographics and attitude of the general public is permanently changing the way financial planning, risk-management and estate planning needs are being addressed.  An increasing number of people, especially the more mature and sophisticated clientele, are looking for a one-stop-office that can address all of these needs together.  That is why banks are busy hiring, housing, and promoting insurance agents and B/D registered representatives.  The number of accountants and attorneys procuring licenses to sell financial/insurance products is increasing.  Many broker dealers and mutual fund companies now offer an assortment of financial services including checking account liquidity, asset-management, and (most currently) estate planning.  Why?  They want (and need) to maintain control of their broker-client relationship!

Important Elements to Any Family Plan
There are essentially four financial components for most family estates: (i) accumulation, (ii) growth, (iii) preservation, and (iv) transfer of assets.  Most financial advisors (i.e., planners, brokers, agents, and accountants who sell insurance and/or securities or who provide fee-only advisory services) are trained to help the client grow and preserve the family estate.  But the fourth component - the transfer of assets - has been customarily disregarded by the advisor and unwisely left to others.  If you as an advisor are not able to assist your clients at even a basic level with their estate planning needs then it is unfortunate for both you and your clients.  The funding process and all-important follow through are usually essential parts in the implementation of most any estate plan.  Full and complete plan implementation is probably not going to happen without you being involved, each time, in a collaborative multi-disciplinary effort toward that end.

Be Prepared to Address Your Client's Planning Questions
Sooner or later your client will confide in you with certain estate planning questions.  Here are a few examples:  What should I do about planning my estate?  Should I have a will or a trust in place or use some other method(s) to meet my goals?  What actually is probate and should I be concerned?  How does life insurance affect my estate for tax purposes?  Are there potential problems associated with rights-of-survivorship clauses in my realty deeds?  How can I arrange to help my dependent child (or grandchild) and/or maintain a level of control regarding specific family conditions after I am gone?  Because you have only limited knowledge or experience with which to discuss your client's concerns, you dutifully recommend him to a lawyer or other professional who you may have heard about, but of whom you have performed no personal due diligence concerning that person's character and ability.  That is a common practice which often creates disappointment, if not real problems, for all parties.

Control Over Client Relationships is Vitally Important
Later, after your client visits your legal referral, you discover that the estate planning work that should have been done was either never completed, or inadequately installed, or even totally disregarded.  Moreover, the thoughtful recommendations that you made earlier were discounted by the referral contact.  Alas, your client is now frustrated and (worse) starts questioning your judgment and professional ability.  It is at this point that you have lost meaningful control of your client relationship.  But take heart, the rules of engagement are changing!  In today's environment - with the emergence of multi-disciplinary networking practices - the concerned financial advisor can and should take positive action to avoid the loss of client control through ill-fated referrals.

Don't Lose the Advantage of Your Existing Position
If you are selling insurance products, you are already involved with front-line estate planning issues.  (Don't you assist your clients in choosing the beneficiaries of their insurance policies?)  However, you probably usually end up only skirting the outer circles of your clients' other important planning concerns and leave it at that.  As a result, your clients' overall estate planning objectives are still left unattended, notwithstanding the fact that their insurance policies are now in place, and they still have more questions than answers.  By not taking advantage of this crucial situation, you are probably foregoing any additional opportunities with that particular client.  If you find that you are unable to assist your clients further, then you will almost always be (a) forcing your clients to look elsewhere to meet their estate planning needs, thereby (b) leaving additional business on the table for someone else, and ultimately (c) forfeiting long-term client relationships.  The problem should not be neglected for obvious reasons, and it can be completely avoided through adequate planning and preparation on your part.

Multi-disciplinary Networking - a Powerful Tool
The advisor who recognizes the issues should seek out and network with qualified professionals in an environment that he can control.  In working within a multi-disciplinary environment that he can "manage", the advisor can turn this potentially adverse one-stop-office trend into an opportunity.  Multi-disciplinary networking relationships can exponentially increase the advisor's knowledge, ability and effectiveness in the market place.  Thus, by incorporating and applying this network application into your practice, you as an advisor can provide information, products, and services to your client which you could not otherwise offer alone, thereby significantly enhancing your value and position with your clients.