A Collaborative Approach is Best for the Client
We sincerely believe that a collaborative approach is best for the client because the roles of the client’s estate planning attorney, financial advisor, CPA and insurance professional overlap. The estate planning attorney is creating, updating and administering a vehicle or many vehicles which hold title. The other advisors are managing the gas that fills that vehicle or vehicles. It is a distinct advantage for the client to know that all of his or her trusted advisors are working together to assist each other in protecting the client.
Roles of Different Professionals and Benefits for each in the Collaborative Process
Please reference “What’s In It For You? Better Understanding the Different Professionals and Their Roles in the Wealth Planning Process” for more detail.
Structures of title and management of assets are inexorably intertwined
Mr. Wittick often explains that he manufactures the “estate planning vehicle” which holds title to all of the client’s assets as the “gas that makes the vehicle run” and it is so true. There are many examples, only some of which are listed here, and it is emphasized that Mr. Wittick receives no fees from any advisors:
● Retirement: A collision of personal planning, income tax deferral, estate tax and advisor goals explained under the “Practice Area” entitled “Retirement Planning” requires the expertise and collaboration of the financial advisor and the estate planning attorney to produce the best result for the client.
● Disability: Given that life expectancy is at all time high for baby boomers and their children are too busy and financially strapped to take care of their elderly parents, statistics prove that an increasing number, and eventually most, will require some form of assistance in a facility. Statistics bear out that eventually Long Term Care Insurance will become a staple, just like care insurance and home owners insurance, because most people just cannot afford the average fee of the inevitable facility, approaching $90,000 per year in California. A well drafted revocable living trust should provide ample instructions for the disability trustee to take care of the disabled trustmaker and avoid a conservatorship but that doesn’t pay for the facility. The estate planning attorney and the insurance professional must work together to educate the client as to benefits and cost.
● Death: A well planned estate requires payment of death expenses, including but not limited to exorbitant probate fees and estate taxes. Insurance for death is like any other insurance in the sense that it is leveraged use of dollars to pay for catastrophic expense and is one of four broad roads of advanced tax planning alternative solutions combined with other estate planning techniques. Many people do not understand that life insurance acts as a “Roth IRA”, which is generally considered to be one of the best investments on the market, with the condition that death occur before payment, but an estate plan is a plan, in part, to prepare for death, and is just another opportunity for education by the insurance professional and estate planning attorney.
Traditional obstacles have reduced results in the past
Expectations define and fears drive any relationship. Traditionally, these have been affected by various factors including the type of advisor, experience level, personality, and whether counseling oriented or transactional such that most traditional relationships have not worked because the following two factors lead to poor results:
1) No stable process or system
2) Struggles over lack of control
New Paradigm for Team Approach Represents the Future
Based upon training from WealthCounsel, LLC, SunBridge and The Advisors Forum, relational advisors and attorneys seek life long relationships with clients and predictive positive results. Coordinated counseling from advisors and attorneys who trust each other sets clear objectives and expectations, provides third party credibility for recommendations, and provides a specific process of meetings and accountability until implementation is complete. A written evaluation of the process by the client is then a reward in and of itself.
Benefits to Client of Collaboration
Similar to the benefits of an architect working in concert with the many different skill sets necessary to implement his design of many different types of buildings, a board of directors of expertise in estate planning, insurance, taxes, investments, real property, valuations and business is invaluable to a good result. Even on simple estates, clients not only have a right to ask their advisors to work together but it is an advantage that should be demanded.
Collaborative Process
Different sets of advisors for different clients does not require reinventing the process wheel in every case. Please reference “The Thriving Model” as a suggested 3 step meeting process in simple cases to mandate advisor involvement. Please also reference “The Process and Benefits of the Financial Advisor Relationship with an Estate Planning Attorney” for further detail.
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