Estate planning is a unique opportunity
Wikipedia defines 'estate planning' as the process of anticipating and arranging, during a person's life, for the management and disposal of that person's estate during the person's life and at and after death while minimising gift, estate, generation-skipping transfer and income tax.
Estate planning includes planning for incapacity as well as a process of reducing or eliminating uncertainties over the administration of a probate and maximising the value of the estate by reducing taxes and other expenses.
The harsh reality is that there is no person alive today who will not die at some point in the future. This means that having to deal with a person’s estate is not only a possible event, it is inevitable.
From Alliott's perspective, this means we have a professional responsibility (legal, ethical and emotional) to ensure that our clients are prepared for this stage in life’s cycle.
Unfortunately, in most cases clients (even those with legal and current documents in place) and their advisers are not properly prepared for death.
As a technical area of advice, estate planning can be very complex and time-consuming.
In addition, it involves skills across a broad range of advisers. These issues alone mean that there is a lack of coordination, work is done inefficiently, different advisers are working with different silos of information and costs for doing the planning work become prohibitive.
Adding further complication is the fact that people are often uncomfortable addressing their mortality, they are deterred by the costs and constantly procrastinate rather than dealing with the issues.
The end result is that many don’t get the proper advice and direction they need so their affairs remain out of control and they fail to benefit from the legitimate commercial opportunity estate planning can offer.
Estate planning is a unique area of advice that naturally intersects all relationships associated with a person.
It is one of the most valuable roles that can be undertaken with a client and means we are engaged with our client at the strategic / management level.
As a result, there are four key steps in our estate planning process:
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Extract the family tree to identify ‘hot button’ concerns. Our clients normally care about their family more than anything else and building a quick family tree allows them to clearly see the bigger picture. We sometimes find raw emotions coming out at this point, but this just reinforces the value of the conversation we are having.
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Demonstrate a solution. Providing our clients with examples of how a comprehensive estate plan can provide protection generally appeals to a client’s desire to be in control of their lives (both now and to have a backup plan should something go wrong in the future).
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Develop an estate planning solution which includes all important information and decisions, as well as a clear crisis management checklist. Review this plan with our client’s immediate family.
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Review the plan annually to take into consideration any updates or changes.
By following this process our clients do engage with us on an emotional, practical and commercial level rather than feeling overwhelmed by technical information, but it is well worth doing. Call Alliotts in Auckland today to find out more on 09 520 9200.
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