I originally had planned on continuing the discussion from last week’s article on lead generation and sustaining an advisory business for the long haul but two events occurred in the last week that has me changing course on this week’s subject matter. 

My aunt, 85 years old passed away from a long a battle with Parkinson’s Disease and my uncle, 75 years old suffered a massive hemorrhagic stroke and unexpectedly passed away during the same week.  The reason for this preamble is simple:  when your number is up, it’s up.  And when its unexpected, your loved ones need to be prepared. Having no guidance in what to do, no wills, no trusts, burial arrangements, financial dealings, etc.  is a recipe for disaster at a time where your ability to think clearly is greatly diminished?  Grieving the loss of a loved one is a paralyzing emotional event and the more preparation, the easier the transition will be to a different life.

I also went through this ordeal with one of my clients some 20 some years ago.

I attended the funeral of one of my client’s husband.  As I made my way through the receiving line at the end of the service, my client’s wife pulled me aside and in a quivering quiet voice she said “Cary, I don’t know what to do, Steven paid all the bills and handled all of our finances.  I don’t even know who to call about our life insurance policies, how to pay our mortgage and what I should to about social security…” and so forth.  I called her that night and we talked for hours, mostly about Steve, their marriage, the happy times and the tough times. During that conversation she reiterated she never thought he would be the first to go and thus had no idea what to do. They didn’t have children or close relatives to lean on and she felt so lost and so afraid.

Thankfully, I had a full review of their estate and kept impeccable records of their “who to call” list.  We navigated through her finances and handled what needed to be handled, but the emotional toll of not being prepared for this event was glaringly apparent as she had forgotten our conversation the previous year.  As I said, her grief left her emotionally wrecked and intellectually paralyzed.  

So where does all this lead?

It’s incumbent upon financial advisors and planners to do their duty and help their clients plan for the worst.  And that means not just for wealth accumulation, retirement, social security planning, etc. It also encompasses the devastating, and many times, unexpected event of death that inexorably confronts all of us.  It’s the “Hard Conversation”, but one of the most important conversations that an advisor is compelled to have with their clients.

There are 3 people that should be involved in a coordinated fashion, with the financial advisor as the quarterback: 

The advisor, the life insurance agent and the estate attorney, which you, as the quarterback, should have already recommended them to Questions asked and information gathered should be the sole focus of that hard conversation:

  • Names, addresses and phone numbers of their attorney and life insurance agent
  • All financial account information such as bank, brokerage and retirement accounts, life insurance policies, access information and locations thereof
  • Location and list of contents of any safe deposit boxes
  • List of real property, i.e., jewelry, keepsakes, motor homes, cars, real estate, etc.
  • Locations and copies of wills and trusts
  • Making sure that your client knows the difference between a will and a trust, specifically that a will is not a legal instrument of instruction but a ‘wish list’ of gifting things in the absence of trust, the latter being a legal instrument. Wills can be changed, contested and overridden, whereas a trust is a legal entity that is used for the transfer of ownership of the decedent’s personal possessions, assets, investments and property, etc.  This particular topic is huge and deserves more discussion and legal differentiation than I can fully explain-that’s what the estate attorney handles.
  • Social Security and Medicare information
  • Employment benefits that are transferable to the surviving spouse or significant other
  • List of credit cards, all debts owed and to whom (if the decedent was not married, the debt dies with them)

This is the short list.  As an advisor, you should have a detailed process for this exercise with all of your clients.

If you are a client, make sure your advisor discusses all issues around estate planning.  As noted previously, this is a very tough conversation to have but one that is a must.  Failing to engage your clients in these would be considered a failure to provide the services that fall under the title of “advisor: or “planner”.  In other words, you have a moral responsibility, not just a fiduciary responsibility to your clients. Making a lot of money for them is not the sole item on your agenda, even if THEY think it is.

Have a great week!

David Roberson

CEO and Founder

Over fourteen years in technology, marketing, and branding for Financial Services.