ELITE ADVISOR BEST PRACTICES

Improving Financial Awareness and Literacy - Part Two

It starts with getting your clients‘ estate planning houses in order. More tools and reminders for elite advisors and their clients

By Valentino Sabuco, CFP®, AEP®

Key Takeaways:

  • In support of National Estate Planning Awareness Week, October 19-25, 2015, encourage clients and prospects to make their estate plans current.
  • The better organized you before meeting your attorney, the more you can save in billable hours.
  • Elite advisors can help solve a major challenge while generating more business for their firms.
  • Do your clients’ executors and trustees know where clients’ key financial information is kept?


In Part One of this article, we discussed the importance of gathering your personal and financial information, setting your personal goals and seeking out the right attorney. Here, we’ll discuss how to make the most out of meetings with estate planners, signing documents, and taking care of title and beneficiary designations.

4. Make the most of your meeting
Bring your notes and the information from Part 1 when you meet with an attorney. This could save one to five hours (or more) of billable time. Discuss your overall goals, and see how they can be met. Ask the attorney about the main documents that need to be prepared:
  • Will
  • Living trust
  • Durable power of attorney for asset management
  • Advance health care directive or durable power of attorney for health care
  • Charitable trusts (if appropriate)

Before leaving the attorney's office, if you and your client are satisfied, request an engagement letter quoting the fee for services and a brief summary of the estate plan—written in terms your client can understand—to serve as a record of the decisions made. Confirm that you want your client to be taking advantage of all tax-saving possibilities—in 2015 an individual can pass on assets federal estate and gift tax free worth $5.43 million; a couple can pass on $10.86 million of assets federal estate- and gift-tax-free, amounts that are indexed to inflation—and when feasible, avoiding probate. If you are dealing with growing estates over $10 million and wish to totally avoid estate taxes for future generations, you and your client may wish to explore dynasty trusts and asset protection trusts within states that have no rules against perpetuities.

5. Review and sign documents

Have copies of draft documents sent to you for review and approval. Note questions and changes in red ink in the margins. Be specific. If you have an estate worth more than $1 million or a complex family situation, have a copy of your documents sent to your AEP, CPA, CFP/PFS, CFP, ChFC, CLU, trust officer or financial advisor for their input. Discuss questions and possible changes with your attorney. After you sign the documents, ask your attorney where they should be kept and what should be provided to family members, executors and trustees.

6. Take care of title and beneficiary designations

Have the attorney make sure that titles on all assets and beneficiary designations, such as life insurance and retirement plans, are coordinated with the will and/or living trust.

7. Estate planning is forever
  • Call your clients’ attorney about updating your clients’ plans at least every three years or any time there are major changes in their personal situation due to births, deaths, marriage or divorce, or significant increases or decreases in the size of their estates.
  • Estate plan documents are technical and very dry; they do not communicate personal feelings. Consider having clients draft a personal letter to their spouse and family expressing their final thoughts and feelings.
  • It’s also important for clients to keep key financial paperwork readily accessible and noted on a location sheet for those who will be dealing with their affairs when something happens to them.
Conclusion and free gift for advisors

Having an up-to-date will and estate plan is a very important financial obligation for all of us. Please actively share this important message with clients and prospects during National Estate Planning Awareness Week, which starts October 19. Be an active participant in one of the most amazing, broad-based, multifaceted campaigns for improving financial awareness and financial literacy. This is an engaging and real winning approach to solving a major social challenge while taking your practice to the next level.

  • Families benefit by learning the essential fundaments of smart financial management so they can make better informed everyday financial decisions and have the best possibilities to reach and maintain their financial freedom and security and advance their personal philanthropy.
  • Financial professionals and their companies benefit by acquiring new business from more informed and motivated clients.
  • Nonprofits win with increased donations, planned gifts, alternate beneficiary selections and bequests.
  • Employers benefit from having less-stressed and happier, more productive employees.
  • The overall community wins with a stronger and financially sound economy.

To learn more about the Improving Financial Awareness & Financial Literacy Movement and Programs and see what your colleagues are doing, review the latest Improving Financial Awareness & Financial Literacy Campaign Report & Magazine.

Free gift for elite advisors. Communicating about where you keep your financial and estate planning information is a finishing touch to every estate plan. To assist you in putting the finishing touches on your own estate plan, download our complimentary My Estate Planning Location Sheet™ for your personal use.

Wishing you much success and all the very best,
Valentino


About the Author

Valentino Sabuco, CFP®, AEP®, is the executive director and publisher of The Financial Awareness Foundation, a 501(c)(3) nonprofit located in Sonoma County California. Valentino has pioneered the financial planning profession for over 40 years. TFAF serves as a nonpolitical and neutral “financial awareness advocate” for the public, the professionals and their associations, educational institutions, and nonprofits. Our mission is to significantly help solve a major social problem by dealing with the lack of financial awareness and financial literacy. We believe teaching financial literacy is very important as it gives people the essential tools to address everyday financial decisions in a more informed manner. Valentino can be reached at V.Sabuco@TheFinancialAwarenessFoundation.org or (707) 586-8620.