Living Trusts – Do You Need a Will Too?

Studies Show About 70% of Americans Die Without Leaving Behind a Will… This Means Financial Advisors Have a World of Opportunity!!

I’ve always said that financial advisors should “practice what they preach”. I say this because the harsh reality is that most professionals don’t have their own “house in order”. For example, the homes of most landscapers are not immaculate when you drive by. If you visit the house of a painter, it’s usually not painted immaculately as a model home. Although we see doctors regularly to maintain our health, if you visit the home of most doctors, you will see they don’t always eat, drink, or exercise in a way that promotes a “perfectly healthy lifestyle”.

So it should come as no surprise that, just like our client’s, most financial advisors…even estate planning attorneys…don’t have their estate planning “house in order”. Some have a Will…but it is out of date. Some may have a Trust…but it is not properly funded. Some may have some major life events (such as new children or grandchildren in the estate, a divorce, a remarriage, someone’s son or daughter got married, they received an inheritance, or maybe they lost a close loved one)…which has not been adjusted to reflect their new or changing estate planning needs and objectives.

Here are the three main points I hope every financial professional can take away from this article:

First…Practice What You Preach:

We really need to take a look at our own practice first and “practice what we preach”. Make sure your personal estate plan is established properly, and kept up-to-date. The is not only the right thing to do for you and your family, but it allows you to gain credibility with your clients by explaining to them what you’ve done, showing them your personal documents and details, letting them know that “you’ve been there”, and what you’ve accomplished because you know this is an integral part of every financial plan.

Second…Review the Basics First:

By discussing the basics about how Wills and Living Trusts work and how they differ (whether with a client or prospective client), this will help:

•Strengthen the financial plans of your existing clients

•Discover new opportunities to help your clients through regular estate planning reviews

•Since a complete estate plan must be coordinated with all aspects of your clients financial lives, this means that it must be coordinated and integrated with you, an estate planning attorney, and even a CPA. Therefore, this provides you the opportunity to help your clients, and at the same time meet and network with many of the estate planning attorneys and CPAs in your area

•Ask for referrals. Once you have finalized, funded, and coordinated a sound estate plan, a client should be extremely pleased with the great things you have accomplished together. Having said that, this opens the door for a great chance to say something like; “Can you think of any co-workers, neighbors, friends, or family members that might also need to make these kinds of improvements? If not, keep me in mind if this conversation comes up because I’d love to help the people you care most about.”

Third…Keep It Simple:

Since 70% of people in America die without creating or leaving behind as much as a Will, what this tells me is that we need to start with the basics…and keep it very simple. Help your clients understand the basic concepts of how this works, the way it works, and why it is necessary.

Therefore, I firmly believe that every financial professional should have a basic informational piece that they can use, which the can review with their clients or mail to them. This piece is the foundation that helps get their clients started in the right direction. This can be used for both their existing clients, as well as for generating new clients and referrals.

This piece should be designed to address what I have found to be the four most common questions that most people need answers to when it comes to estate planning, and choosing Wills and/or Trusts:

Four Most Common Questions Regarding the Basics of Estate Planning:

1.  Why Do I Really Need a Will?

2.  What Will Happen If I Don’t Have a Will?

3.  What is the Best Choice for Me…a Will or a Trust?

4.  How Do I Get Started?

What’s Next?  5 Easy Steps to Getting Started:

Step One: Spend some time with your existing financial advisor, or an experienced financial advisor in your local area, so you can review the basic details your “big picture financial plan” together

Step Two: Your financial advisor will review this information and help you assess confirm exactly what your estate planning needs and preferences are

Step Three: Once your financial advisor reviews your overall estate planning needs, they can help you understand exactly how Wills and Trusts work, as well as which one they feel fits your situation best

Step Four: After you are fully comfortable and confident with their recommendation, you can consult with a seasoned estate planning attorney who can help you properly draft these documents and details

Step Five: Arguably the most important step, and often overlooked, is making sure that your estate planning attorney, financial advisor, and CPA are all working together to ensure all of your estate plans and preferences are coordinated and working properly with your “big picture financial plan”.

So to summarize this article, I hope every financial professional who reads this is able to see this fantastic opportunity to grow your practice and help families add a valuable and necessary addition to their comprehensive financial plan. What a win-win situation for everyone involved!

As a parting thought, think about this fact: If approximately 70% of people who die in America are failing to leave their loved ones a simple Will, what this says to me is there are lots of people and families out there who need your help.

The reality is that, as a financial advisor, when you review an estate plan, recommend a Will or a Trust, and refer your clients to a qualified estate attorney…you are not typically compensated for doing this type of work. However, by doing “the right thing” for your clients, the most important rewards will come back to you in more ways than you can imagine. It is these kinds of selfless rewards that can extend far beyond any revenue you could ever receive.

Christopher P. Hill, Founder of FuneralResources

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