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Engaging Survivors and the Next Gen

Two of the most efficient ways to grow an advisory practice are 1) to help your existing clients grow their assets and 2) through referrals. Yet, many advisors continue to ignore an opportunity that combines both: the surviving partner and the next generation. As many as 70% of survivors abandon the advisor upon their partner’s death as do 90% to 95% of surviving offspring. With an estimated $40 trillion being transferred to surviving family members in the next three decades, that’s a lot of lost opportunity.

A recent study by InvestmentNews Research in conjunction with Cadaret Grant, reveals that only 24% of advisors currently have developed a plan to engage survivors and the next generation, but of those, more than half report the plans have paid dividends. The report recommends putting a plan in place, one that addresses these three imperatives:

Engage the non-involved partner.

Often, one partner is less engaged than the other because of either indifference or deference. How to engage them?

•  Involve them in all substantive discussions and decisions to be sure their goals too are being addressed

•  Encourage their questions and provide answers that are jargon-free

•  Talk frankly about what will happen when one of the partner dies, and how that may change depending on who predeceases whom

Understand and work with adult children.

Two practical ways to foster engagement with children are to 1) have a younger member of the advisory team serve as a key link, and 2) waive the minimum requirements to become a client as part of a relationship focus. Once a dialogue has been established, there are a number of areas to engage on:

Strategies to pay down debt

•  For new or even established parents, 529 plans and other strategies for college saving

•  Insurance needs and the importance of wills, living wills and healthcare powers of attorney

•  Including them on your firm’s thought leadership and topical written communications

•  Providing links to financial information they’ll find useful for their children and for themselves

Consider the needs of your elderly clients and their families.

With a growing number of clients in their late 80s and 90s, many advisors may be, or could be, dealing with children of clients who themselves are nearing retirement. Many of them may not be satisfied with their advisor or may not have one at all. Providing useful information and assistance to their aging parents can be a valued service to them now, while at the same time giving them a sense of what you may be able to do for them in the future. Specifically:

•  Helping them detect and prevent elder fraud and abuse

•  Organizing financial information

•  Providing information on eldercare

•  Providing referrals to trusted elder-law attorneys