As an estate planning attorney, your mission is to maximize the assets your clients pass on to their heirs.
For example, you may take steps to minimize the impact of taxes, health care costs, and investment fees.
These could chip away at your clients’ wealth.
With you and your clients in mind, we have identified three forces with the potential to shape the estate planning industry in 2020 and beyond:
- Baby boomer distribution of wealth to future generations
- Popularity of cryptocurrency
- Estate planning technology
The great transfer of wealth
Back in September, we referenced a 25+ year transfer of wealth now underway in this country.
CNBC estimated its value at $68 trillion.
It’s being fueled by baby boomers leaving their estates to younger family members.
One way they can help ensure the bulk of their estates pass on to their heirs is by purchasing long-term care (LTC) policies.
Because LTC insurance is much more affordable if policyholders are healthy, encourage a eligible client to buy it now.
Otherwise, if they become seriously ill, medical expenses could take a huge bite out of their assets – or deplete them altogether.
The rise of cryptocurrency
These days, you can’t turn around without hearing about crypto or bitcoin, which is one form of cryptocurrency.
Adding cryptocurrency to wills and living trusts is a trend Brian Chew, founder of OC Wills and Trust Attorneys in California, has predicted.
Chew cautions that managing cryptocurrency is a lot more complex than managing traditional assets.
For instance, if you have a client wishing to leave cryptocurrency to beneficiaries, make sure the client includes in their estate plan all the information necessary to claim it.
He further advises you keep in mind the party with the “keys” controls these assets and can move them pretty much anywhere they choose.
The emergence of technology
Overall, the estate planning process continues to be heavily people oriented and paper based,.
However, InvestmentNews has identified two legacy planning platforms some advisors are using.
The first of these is Everplans. It was launched by its founders in 2011 to provide an educational tool for end-of-life planning.
Advisors who want to serve clients beyond simply handling investments, can use it to store wills and other information such as financial accounts and insurance policies. Clients, meanwhile, can upload documents, photos and much more.
The second, Yourefolio, was launched in 2015 by a former investment advisor representative.
This platform can be used to build out an estate plan and show advisors where that plan may need shoring up; as well as aggregate a client’s assets.
Unlike with Everplans, which is a client-facing product, advisors using Yourefolio own the estate plan and associated data.
The importance of communication
By its very nature, estate and legacy planning is a deeply personal undertaking.
No two scenarios are the same.
Furthermore, every client is unique.
So before you follow any trends, or consider adding or updating technology, be sure what you propose to do is compatible with your clients’ wants and needs.
One final note…
The Setting Every Community Up for Retirement Enhancement, or SECURE Act, went into effect today.
Signed into law last month by President Donald Trump, this legislation is designed to give people more ways to save for their post-working years.
Among other things, it affects retirement account taxation and required minimum distributions (RMDs) from retirement accounts.
Do your clients realize the ways the SECURE Act will impact their estates?
If not, you need to tell them now.
Click here if you’d like to learn about our client acquisition services for estate planning professionals.