By Bobby Hickman
Engaging Families in
Financial Planning
Advisors Strive to Keep Spouses, Heirs in the Loop Advisors who prioritize keeping clients’ families involved in the financial planning process find the approach beneficial for both their customers and their practices.
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wenty-seven percent of North American clients ask their financial advisors to educate family members about investing, according to a recent global survey of financial professionals conducted by Natixis Investment Managers. Eight percent had also helped clients address family-related matters, such as mediating conflicts or trust and estate planning. The survey also found that 39% of advisors considered establishing relationships across family generations as one of their most effective prospective activities. “Estate and wealth transfer planning is extremely important because it’s inevitable for us all to transfer wealth someday,” according to Rashonner K. Lillie, CFP®, CRPC®, private wealth advisor and managing director at Reveal Wealth Strategies in Houston. However, those transfers are not always triggered by expected events. Lillie said she helps clients plan ahead for what she terms the “4 D’s”: divorce, disability, death, and disease. “During the 17 years of my career, at least one of these “D’s” has happened to a client each year – and it’s not age dependent,” Lillie told 6 / ADVISORS MAGAZINE
MAR 2022
Advisors Magazine. “Not discussing unexpected life changes doesn’t make them disappear.” Christopher Mankoff, CFP®, chief portfolio strategist at JTL Wealth Partners in Southlake, Texas, added, “A situation that happens far too often is when one spouse passes away and the surviving spouse is unable to pay bills, cover medical expenses, or even buy groceries because the deceased spouse always handled the finances. That situation confirms my belief that both spouses or partners should always be involved and educated when it comes to their financial health and future.” To prevent those scenarios, Mankoff said, he requires both parties to attend at least one of the two semi-annual review meetings he conducts each year. He also lets potential clients know before their first meeting that he cannot take them on as new clients unless they both agree to meet regularly during the initial planning phase. Four Options for Educating Families Jennifer R Lee, AWMA®, AIF®, founder of Modern-Wealth LLC in Sarasota, agreed that involving family members
in the conversation is a significant consideration for her clients and for her firm. Subjects such as beneficiary designations, inheritance, and legacy provide natural opportunities for advisors and clients to consider whether heirs have the aptitude and the skillset to manage wealth. “Money can be a burden and it can be squandered,” she said. “When I ask clients if they believe their kids or grandkids are capable and prepared, they often say no. Financial literacy is not widely taught, and many people lack the depth or preparedness necessary to manage, retain, and enjoy the assets. For many clients, they have little to no interest; for others, it means lifelong learning.”
