Estate planning is not just for the wealthy

Estate planning isn’t only for the wealthy. It’s a crucial part of financial wellness for everyone.

Two advisors discussed why financial professionals must have estate planning conversations with clients during a recent webinar by the National Association of Insurance and Financial Advisors.

Clients often believe estate planning is about how much money they can give away, said Troy Branch, second vice president of advanced planning with Ameritas.

“Too often, someone thinks that if they are below a certain number of assets that they can give away, they don’t need estate planning,” he said. “But estate planning is for everyone.”

Branch said family members often will fight over money after a loved one dies. But that fight is about more than money.

“I believe families will fight,” he said. “They might be fighting about money but they fight about pots and pans and memories. We have a duty to keep families together and plan for things that aren’t money.”

People often delay estate planning because they fear it is too complex, Branch said. They also fear having tough conversations.

“But I view tough conversations as an opportunity to know your family better. You talk about what you want to happen with your estate, what your family wants to happen with it. You can’t do this without going through the estate planning process. Talking about what’s important to you is more important than the money.”

Estate planning is crucial for business owners

Andrew Rinn, assistant vice president of advanced sales strategy with Sammons Financial Group, said estate planning is crucial for owners of small- to medium-sized businesses.

“A lot of business owners try to separate their business wealth from their personal wealth,” he said. “Sometimes you can’t convince a business owner to have a trust or a will. I tell them you need to have a will for your business – that’s what a buy/sell agreement is.”

Rinn cited statistics that said only 30% of family-owned businesses survive into the second generation and only 12% survive to the third generation.

“How many of those statistics are because of poor planning?” he said. “What a pivotal role we have in helping clients succeed rather than fail when it comes to their business.”

 

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