According to studies, a vacuum exists in the financial advisory space when it comes to serving the estate planning needs of high-net-worth families. It seems advisors generally lack the confidence it takes to tackle this critical and often sensitive space. Their reluctance is understandable. After all, assuming responsibility for a family’s long-term legacy goals has deeper psychological ramifications, then say, developing an asset allocation model for an investment portfolio. Inheritances, business succession decisions, philanthropic impulses — these are sensitive issues for the even the most functional families. Shake in long-standing baggage, and you’re in downright thorny territory.

But advisors willing to charge in head first, are not only doing right by families and their multi-generational futures, but they’re likely to see an uptick in fees, as a result. Simply put: the estate planning niche represents an up-for-grabs opportunity. (For more, see: Finding & Retaining High-Net-Worth Clients.)

Vital Questions

Carving out space in this area requires a hub and spoke approach, where advisors must network with a team of outside professionals. And this entails first gaining a deep-dive understanding of a family’s history to report to these strategic partners. And the more detailed a family’s dossier is, the better they can be served. This makes rigorous intake interviews with families a critical exercise, where vital to the discussion are the following questions:

  • How much does each family member need to maintain the lifestyle they’re used to?

  • How much money do parents think their children deserve?

  • How will the next generation be groomed to takeover businesses?

  • How much cash will be allocated to family foundations?

  • Who will have governance over businesses and foundations?

  • What values are important to pass on to future generations?

  • Which family members hold healthy views towards wealth? Who abuses money?

  • What has been the historic tax treatment?

  • How have gifting issues been historically handled?

These guidelines are excellent points of entry to initiate dialogue. But to truly get to know clients, advisors should let conversations unfurl organically, so clients feel free to confront the emotional drivers that govern their major decisions. This can be accomplished by asking open-ended questions, rather than numerically-based ones. Instead of asking: “How many employees are on your payroll?” ask: “What do you like about this industry?” This psychological approach will unearth macro goals and jumpstart the estate planning function for advisors and their colleagues. (For more, see: What High-Net-Worth Clients Value and Need.)

On Speed Dial

Networking with a qualified accountant is a critical first step in building an advisor’s outside roster. Accountants are accustomed to dealing such nuts-and-bolts issues as business transfer, asset protection and retirement planning. Contacting your state society of CPAs is a one way to find accounting talent, but a thorough vetting process is paramount to prudent selection. This means asking them kinds of clients they serve, their areas of specialty and what their marketing aims are. Not all accountants are skilled at handling wealthy individuals — especially those with legacy business concerns. (For more, see: Tips for Wooing Wealthy Clients.)

A stable of legal support is the next estate planning must-have, in your all-star team. Next come bankers, insurance professionals and charitable organizations you can proactively recommend to your high-net-worth clients. Getting to know the principals of educational outreach programs and other charities, then facilitating intros with your clients not only shows initiative, but the charities can likewise connect you with other high-net-worth donators, who can augment your overall client-base. (For more, see: Top Tax Issues for High-Net-Worth Individuals.)

The Bottom Line

Taking the time to sit with your high-net-worth clients and learn their deeper motivations will not only help you better understand the complexities of their estate planning needs, but it will aid the process of conveying key information to the strategic partners you’ve lined up. (For more, see: How Do I Attract High-Net-Worth Individuals?)

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