estate planning 5 ways to engage with your clients
Post on 11-Jan-2017
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Important Notice
Who is Gil Gordon?
• Joined profession in 1994
• CFP
• Principal – RI Lower Hunter a traditional, mid sized
planning business in the Hunter Valley of NSW
• Author: “The bugger went and died on me…AND I
DON’T KNOW WHAT TO DO!”
• Passionate about Estate Planning, Cashflow and
business innovation
• Married, 4 kids, lives and plays on a 10 acre horsey,
hobby farm in Maitland
Important NoticeGil Gordon is a director of Systems For Professionals Pty Ltd and
employed by Gordon Financial Services a licenced Financial Adviser
with RI Advice Group.
RI Advice Group Pty Ltd, ABN 23 001 774 125, holds Australian
Financial Services Licence Number 238429 and is licensed to provide
financial product advice and deal in financial products such as: deposit
and payment products, derivatives, life products, managed investment
schemes including investor directed portfolio services, securities,
superannuation, Retirement Savings Accounts.
The information presented in this seminar is of a general nature only and
neither represents nor is intended to be specific financial or legal advice
on any particular matter. Gil Gordon, Systems For Professionals & RI
Advice Group strongly suggests that no person should act specifically on
the basis of the information contained herein but should obtain
appropriate professional advice based on their own circumstances.
The Mandatory Disclaimer!
Today’s Agenda
1. Family Tree: good advice puts people first!
2. Story Telling
3. Common Problems and their solutions
4. Deliverables the clients actually care about
5. Pricing & Positioning
“Mum & Dad” not “HNW” value proposition.
Important Note: there is no difference in the approach to HNW clients.
1 generation up• Parents
• Elderly dependant relatives/friends
1 generation across • Siblings
• Business partners
• Close friends/dependants
2 generations down• Children, step children & “child type” dependants
• Grandchildren
People First
Ask about:1. Physical & Emotional Dependency
2. Health
3. Behaviour and skill with money
4. Influence of spouses, in-laws & associates
5. Divorce risk
6. Financial situation
7. Debt burden
8. Substance abuse and behavioural issues
9. Business risks
10. Domicility
People First: Questions
Quick ‘how to’ for advisers: 1 up, 1 across, 2 downWidowed, frail ,
physically dependantDisabled
Financially dependant
No financial complexity (NFC)
NFC
NFC
Family Tree: 1 up, 1 across, 2 down
Step father Healthy
Divorce &
Inheritance Risk
Ask about:1. Physical & Emotional Dependency
2. Health
3. Behaviour and skill with money
4. Influence of spouses, in-laws & associates
5. Divorce risk
6. Financial situation
7. Debt burden
8. Substance abuse and behavioural issues
9. Business risks
10. Domicility
People First: Questions
Quick ‘how to’ for advisers: 1 up, 1 across, 2 downWidowed, frail ,
physically dependantDisabled
Financially dependant
No financial complexity (NFC)
NFC
NFC
Acrimonious Ex
PAYG
Blended family
Strong marriage
$ pressure
Marriage strained
Self employed
Debt pressure
No substance abuse
One child with Aspergers
Good marriage
No substance abuse
Strong with $
PAYG
Step child
Financially
dependant
Family Tree: 1 up, 1 across, 2 down
Step father Healthy
Watch out for the Love Child!
Divorce &
Inheritance Risk
Ask about:1. Physical & Emotional Dependency
2. Health
3. Behaviour and skill with money
4. Influence of spouses, in-laws & associates
5. Divorce risk
6. Financial situation
7. Debt burden
8. Substance abuse and behavioural issues
9. Business risks
10. Domicility
People First: Questions
Ask about:Storytelling
Setup &
Engagement
Dramatic
Event
Relax &
Reflect
Storytelling
Journey
Emotional
Ask about:Storytelling
Stories told by a professional :
1. Interesting & relatable
2. Suspend the rational mind (for a period)
3. Create emotion
4. Drive engagement
5. Create a call for action
www.estateplanningforlife.com.au
Ask about:Storytelling
https://vimeo.com/85493206
One of the most popular Superbowl
commercials of all time
What follows is not legal advice
you can rely upon!
Cultivate a relationship with a competent estate
planning legal service provider!
In my experience they are hard to find!
Yet Another Disclaimer!
4 Reasons to review the Will
1. Tax
2. Divorce
3. Death
4. Asset Protection
The Right Legal Documents
A Testamentary Trust
$
• Like a “will trust” for a young child, but it applies for adults and lasts up to 80 years
• $ don’t pass directly to beneficiaries
• $ pass to a trust controlled by a trustee (normally child) for your bloodline’s benefit
Not like this
$
Like this
The Right Legal Documents
$18,200 $37,000 $80,000 $180,000
0% 21%
34.5%
39%
49%
Effective 2013 Income Tax Scales(Including 2% Medicare)
Example: Inheritance Invested
Estate of $1,200,000 with 2 beneficiaries
Inheritance amount: $600,000 each
Investment yield: 6% (say )
Interest earned: $36,000 pa
34.5% income tax: $12,420 pa tax
2 Families: $24,840 pa tax
Reason 1: Tax
A Better Solution: 2 Testamentary Trusts
Same Income ($36,000 to each family)
Income allocated to grandchildren (not adult children)
$18,000 income to each grandchild
$0 tax!
Annual tax saving across 2 families up to $24,840
$
$1,200,000 estate
Reason1: Tax
Death & Repartnering: a better way
Trust
Bloodline
Beneficiaries
Family appoints
the next trustee
$
$
Reason 3: Death
Bankruptcy & Legal ThreatRemember 1x 2½x 22½ x
Top 5 reasons for personal bankruptcy:
Job Loss
Divorce/separation
Debts and credit cards
Poor health
Adverse litigation
Reason 4: Asset Protection
(Financial Stress)
(Fire) (Health)
Protecting The Family Home
Repay
Bank
$
Trust
Inheritance$
Family Home Unprotected!
Risk
Risk
Loan
Registered
Mortgage
Protected by loan to Trust
Reason 4: Asset Protection
Ask about:What is the state of implementation of an Estate Planning Service in your practice:
1. Implemented
2. Currently under development
3. We see the need and want to develop a service
4. Currently researching and considering it
5. Not on our radar but interested
Survey – your practice
Our practice focuses on:
1. Retirees and pre-retiree investment services
2. Specialist risk practice
3. Holistic – investment & risk, broad age profile
4. Niche market specialist
5. Other
Partnering With Legal ProfessionalsReferral Options Issues
Cold• “Go and see your solicitor…”• Not a value proposition of your firm• Lawyer may undermine you• High risk lawyer lacks relevant skills• Very hard for you to charge fees
Warm• Advisers briefs lawyer• Good if client complexity exists or if relationship is reciprocal• Not a value proposition of your firm• Lawyer positioned as a “alpha adviser” not you• Risk lawyer may undermine your advice or lack skills• Difficulty charging fees: “Why do I have to pay you and the lawyer?”
In House• Position lawyer part of your value proposition• Lawyer validates and supports your firm and skills• Specialist online estate planning lawyers are set up this way• Very easy to charge “facilitation” fees• Generally lower overall cost for client• Lawyers accept liability in writing for legal advice
1. The Right Legal Documents to protect your family
2. The Information That Matters
3. A Crisis Management Plan
4. Engage with the next generation
5. Ongoing Review
Key Deliverables
What is EPFL?
1. WITYEP
Survey
2. The Information That Matters
(ITM)
3. Estate Planning Record
4. Crisis Mgmnt Plan
(CMP)
5. Review
• WITYEP – What’s Important To You – Estate Planning
• Online gap analysis tool that helps you identify and
prioritise your estate planning concerns
• Estate Priorities Report of issues to be resolved
• Register of information that family
and professionals need to assist
with estate matters
• People, Structures, Documents,
Assets, Debts, Insurances, Legal
Responsibilities
• What do I need to know?
• Who do I call?
• What do I ask them?
• What is important?
What can wait?
• Regular review of your legal docs,
ITM & CMP
• CMP is an action plan for family to
follow during a crisis • Automated extract of key issues
identified from the EPFL system
• Creates a briefing note for other
professionals (e.g. solicitor)
1. People
5. Debts
6.Insurances
7. Responsibilities
THE INFORMATION
THAT MATTERS
4. Assets
2. Documents &
Information9. Medical
8. Bills
10. www...
3. Structures & Business
The Information That Matters
Plus:
Assets
Liabilities
Structures
Insurances
Legal Responsibilities
Online identity
Medical history
etc
The Information That Matters
1. The Right Legal Documents to protect your family
2. The Information That Matters
3. A Crisis Management Plan
4. Engage with the next generation
5. Ongoing Review
Key Deliverables
If the worst happens don’t expect me
to think clearly or know what to do.
I will put one foot in front of the other
until I recover.
But in the meantime I need you to
give me a simple guide, step by step,
day by day.....
......... Angie W.
Crisis Management Plan
1. What documents do I need?
2. Who do I need to call?
3. What to I ask them?
4. What’s important?
5. What can wait?
Crisis Management Plan
1. The right legal documents to protect your family
2. The Information That Matters
3. A Crisis Management Plan
4. Engage with the next generation
5. Ongoing Review
Key Deliverables
1. They care about their parents
2. They have children too….
3. They are curious
The Next Generation
1. Legal documents – every 5 years or so
2. Information That Matters – every 12-24 months
3. Crisis Management Plan – every 12 -24 months
Ongoing Review
1. The Right Legal Documents to protect your family
2. The Information That Matters
3. A Crisis Management Plan
4. Engage With Next Generation
5. Ongoing Review of your estate planning needs
6. No SoA and associated complexity
Client Value Proposition
Ask about:Rank out of 5 (1 = lowest, 5 = highest) the extent to which you
could implement profitably the models for engagement:
1. Family Tree
2. Storytelling (e.g. the eBook)
3. 4 Reasons to Review Your Will
4. Partnering With Lawyers
5. Demonstrating tools like Estate Planning For Life
6. Engaging with the next generation
Survey
1. Transactional vs ongoing charging model
2. Legal documents
i. Solicitors typically charge $3,300 to $11,000 for this work
ii. Online $1,000 to $2,000 + your fees
3. Our fees for Estate Planning For Life service to clients
i. Lowest $550 pa
ii. Normal $1,320 pa
iii. Highest $9,900 pa
4. Platinums first, after 6 you will be using EPFL to win new business
5. Be wary of undercharging for this work, very little price resistance
Pricing & Positioning
If I had asked my customers what they wanted, they would have said
“...a faster horse....”
Henry Ford
Leadership
You need to lead the change...
linkedin.com/in/gordongil
gil.gordon@estateplanningforlife.com.au
@gordongil
02 49330100
eBook: www.estateplanningforlife.com.au
Contact
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