Engaging and Retaining Families

Knowing the secret fears of the rich can give elite advisors a significant edge

By Diane Doolin, Vic Preisser and Roy Williams

Key Takeaways:

  • The majority of children and widows do NOT keep their inheritances with the same financial advisor after the death of their parents/husbands.
  • Savvy advisors realize that it’s just as important to prepare heirs for assets as it is to prepare a client’s assets for heirs.
  • The loss of heir families as clients historically has been driven by the lack of a relationship between advisors and their clients’ heirs.
  • Progressive advisors initiate conversations with clients by asking how the transition of family wealth will impact the lives of their children and grandchildren.

Portions of this article have also appeared in Investments & Wealth Monitor.

Every year for the next 50 years, $1 trillion will pass from one generation to the next, resulting in the greatest wealth transfer in the history of the United States. For financial advisors the question becomes, “Who will heirs turn to for guidance in managing that wealth?”

As Barron’s reported as far back as 2011, only 2 percent of children keep their inheritances with the parents’ financial advisor and fewer than half of wives (45 percent) keep their assets with the same financial advisor after the death of their husbands.

Data also shows that once assets are transferred to heirs, regardless of whether a parent has died, more than 95 percent of inheritors promptly change advisors. This results in advisors constantly working to replace lost clients rather than recruiting new ones.

Adapting to Change

About every ten years, a sea change occurs in how financial advisors deliver services to clients.
Consider the following:


A broker and a single practitioner bought and sold stocks and bonds for clients and charged a commission for each transaction.


A financial advisor and a single practitioner provided investment allocation advice for a fee.


Wealth management teams provided thoughtful solutions to clients by delivering expertise and resources for investment allocation advice, coordinating client wealth management needs to include estate planning, tax planning and philanthropic planning.


Forward-thinking advisors will take the traditional wealth management model (investment allocation advice, tax/estate and philanthropic planning) one step further by connecting with the next generation through preparing heirs to receive and manage wealth.

Exhibit 1.0

We are again entering a sea change—perhaps a tsunami. For those figuratively “at sea,” working daily in the financial advisory field, this wave will sweep past with but a ripple of acknowledgment. The forward-thinking advisor who recognizes the change has an opportunity.

Historically the industry has focused on preparing assets for heirs; with our more affluent client levels, we now begin to offer the other half of that equation—we go from preparing assets for heirs to preparing heirs for assets.

New Opportunity for Advisors

The loss of heir families as clients historically has been driven by the lack of a relationship between advisors and their clients’ heirs. Do you even know the names of your best clients’ children? Without a direct relationship with the family financial advisors, the children are unlikely to understand and appreciate what the advisor has done to build and retain the family’s assets. How does an advisor connect with heirs and develop a relationship with the family before the estate transfers? The relationship with heirs begins with the parents and their wish for long-term guidance for their children. Clearly it takes time for heirs to come up to speed on the family’s assets, the long-term wishes or mission of the family, the legal and tax configuration of the assets, whether in trust or liquid form, etc.

The sooner the advisor connects with the heir, the better the opportunity to build a relationship with all members of the family. The real emergent opportunity is having several client heir families as new clients instead of losing the single parental client as the estate transfers.


Whether or not you establish a relationship with a client’s heirs and family, factors within the family can stymie post-transition success. You can help heirs with asset management, but can you contribute to needed changes in their personal family life? The forward-thinking advisor acknowledges these concerns and initiates a conversation with the client that begins with the following question: “Will the transition of the family wealth have a positive impact on the lives of your children and grandchildren?”

Next time, we’ll explore how to initiate that important conversation, which conversation starters to use and what the outcome of that conversation should be.

About the Authors

This article was contributed by Diane Doolin, Vic Preisser and Roy Williams of The Williams Group and co-founders of the Institute for Preparing Heirs. Diane Doolin is senior partner of The Doolin Group at Morgan Stanley Smith Barney and a founding director of the Institute for Preparing Heirs. The Institute teaches advisors how to start conversations with affluent families on the successful transfer of wealth to the next generation… then provide tools and resources to support their client families over time.