No one likes to envision their loved ones lives after they’ve departed. It’s unpleasant, stressful and at times, emotionally draining. Your clients are no different. Chances are they’ve been avoiding taking action on how their assets will be dispersed in the event of their death. They’re not alone. In fact, over half of Americans do not have a will.
Why estate planning matters
Estate planning is critical in the financial health of any individual or family. Knowing how their wealth will be distributed should they pass, has no bearing on the person who died, but is a great service to those who are left behind.
Most of your clients will have a (or several) recipients in mind. If it’s not family, then likely a friend or close acquaintance. This is important to convey, because without a will, assets can be held up in litigation for a long time and will ultimately be determined by the legal system. If there is an estranged family member, without a will, they can make a legitimate claim to some of the assets in certain situations even if that was never the intention of the person that is gone.
Your role as an advisor
Many people, from all walks of life have had long battles over wealth because of improper wills or the failure of the deceased party to put one in place. Often times, these are heart-wrenching situations because there is no do-over and there is no second chance. Once your client is dead, that’s it, whatever legal framework they have at the time of death will be what is used: a sobering thought for the underprepared. Ask your clients if they have given this serious thought as it is nothing to take lightly.
Simply put, a will is in place to make sure your client’s wealth is protected and distributed to the people and institutions they care about as a final gift. Encouraging your clients to put a will in place is, in no uncertain terms, your responsibility as a financial advisor. They are paying you to manage their wealth whether they are alive or dead. Make sure you do them the service of addressing uncomfortable issues like their death because most people don’t want to.
Ensuring that your client’s have an estate plan is also a key component of creating a trusted relationship. When you show that you have their best interests in mind – beyond the time that they will be your client – you show that they are more to you than a number. You can also use this time to discuss their charitable giving and trusts.
Helping your client think about all aspects of their wealth, including estate planning, investing, and health ensures that your value as an advisor goes beyond products.