In my 30-plus years of experience as a financial advisor, my chief objectives have been to ensure my clients sleep well at night safe in the knowledge they are in good hands, to help them to meet their financial goals and to ensure their experience with my firm is such that they can wholeheartedly say they are glad they met us.
With these tenets at the core of my approach, I've come to focus on the power of estate planning as a tool to expand my service offering and forge stronger client relationships.
Steve Lockshin, founder and chair of Vanilla
One of the most natural ways for advisors to expand their role and provide total wealth advice is by having regular estate planning conversations with clients — regardless of an advisor's depth of expertise in any given aspect of estate planning. Advisors should think of themselves as the quarterback huddling with the team to call plays, run estate planning strategies and direct whichever players are best suited to execute the game plan.
A 2023 report from Cerulli Associates concludes that advisors must "consistently investigate the evolution of clients' dreams, concerns and fears." The demand for holistic advice will only increase in the coming years, making the continued relevance of the modern advisor dependent on remaining at the center of the conversation, recognizing opportunities and coordinating a team of experts to fulfill the client's objectives.
The validity of this approach is further borne out by a study from Spectrem Group that shows that 93% of people want estate planning services from their financial advisor, but only 22% are getting that advice. Further evidence can be found in Vanilla's 2023 estate planning study, which found that clients with more than $25 million in household net worth were five times more concerned about their heirs being negatively impacted by inherited wealth than they were about how much their estate would be taxed. By definition, then, there is a massive opportunity for advisors to close the estate planning advice gap and showcase their value by taking a more comprehensive view of their clients' total wealth.
Choose your conversation
Topics of regular estate planning conversations with clients can include:
Appropriate life insurance levels. Determining the appropriate level of life insurance is crucial for safeguarding loved ones in the event of an unexpected tragedy. Financial advisors are well-equipped to guide clients in understanding what is needed to shield families from potential financial strain during difficult times.
Unnecessary tax liability. Strategies like tax-efficient gifting, irrevocable life insurance trusts and qualified personal residence trusts can help advisors strategically position assets to minimize tax burdens. Estate planning conversations help advisors develop the right approach for each client's specific situation and safeguard total wealth for generations.
Succession plans for business owners. Advisors should support business owners in developing a comprehensive succession plan that should be revisited regularly to account for evolving business dynamics, family circumstances and personal goals. By crafting and updating a succession plan, advisors demonstrate their commitment to the client's legacy beyond their lifetime.
Appointing appropriate fiduciaries, beneficiaries and powers of attorney. Choosing fiduciary, beneficiary and powers of attorney designations are vital steps for executing a client's intentions across financial matters, as well as legal and health issues that can impact their family's future in the event of their death or incapacitation. Advisors should help clients review these designations regularly for evolving life circumstances, relationships and priorities.
Collaborating with technology
As advisors expand their scope, technology can enable collaboration, education and execution at scale. By deploying tech solutions to reduce administrative burdens, automate routine tasks and manage complex financial data, advisors have more freedom to focus on nurturing client relationships, personalizing strategic plans and proactively addressing specific client needs.
Now is the time for advisors to focus on moving estate planning forward from a one-and-done task to an ongoing practice of active, strategic advice. It's a more expansive way to think about a financial planner's role — one that helps advisors differentiate their services and justify their fees while ensuring that clients and their families sleep well at night.
While at Schwab, Roberto Ortega worked with clients whose accounts held more than $1.5 billion. A lawsuit seeks to bar him from soliciting their business for his new employer.
In time for the season of giving, the new functionality allows those on the philanthropic planning platform to encourage others to join them in supporting causes they care about.
A former veteran UK-based planner and a behavioral analysis expert penned a practical guide for financial advisors on implementing "EI" into their practices.
The standard-setting group is mulling increasing continuing education requirements and requiring that CFP aspirants have certain types of financial planning-related experiences, among other changes.
Jordan Hutchison, vice president of technology and operations at RFG Advisory, helps support 69 advisory teams nationwide, which manages almost $5.5 billion in assets.
