As a financial planner, you have the power to help clients create an estate plan that promotes and reinforces a values legacy that can be passed down through generations.

No two families have the same core values or estate planning needs, but there are some tried and true techniques you can use to help your clients pinpoint their specific goals.  

Help Clients Identify Their Key Values

For clients who are just beginning the estate planning process, it’s likely they’ve never thought about how their estate plan can promote their values. It’s helpful, both for you and your client, to sit down and discuss what their ideal outcomes are for the estate plan. What beliefs, core principles or qualities are important to them? What milestones do they want their children to reach? Encourage your clients to think about how their estate plans can properly asses the Four C’s:

  • Character: Their plan will encourage heirs to cultivate good character.
  • Competence: Their plan will motivate heirs to become competent and capable.
  • Confidence: Their plan will inspire heirs to succeed.
  • Core values: Their plan will prioritize core values that are important to the family, such as honesty, respect or education.

Once clients have identified their values legacy, you will be able to work more effectively as a team and create the estate plan that’s best for them.
Drafting a Personal Directions Letter

A directions letter is a useful technique for clients to identify and review what values they would like to instill in their beneficiaries through their trust and estate plan. Although not part of the formal trust, a personal directions letter provides guidance to the successor trustee on how financial issues should be handled and offers a vision for how they can use their inheritance to reach their goals. The letter may or may not be shown to heirs, but it can be a good starting point for clients to determine what they want their trust and estate plan to achieve.

Consider Incentive Provisions and Trusts

Particularly for clients with young children or those who are concerned about the money management skills of their chosen beneficiaries, incentive provisions and trusts can be an excellent way to motivate heirs to reach their goals. Perhaps the most common incentive provision is a college graduation requirement or “performance bonus” for children who obtain a degree from an accredited university before the age of 25. To avoid allowing beneficiaries to become “trust fund babies,” some families may want to include a requirement that heirs have a full-time job by a certain age or during a specific age range. Encourage clients to be creative when considering incentives — there are options for every family’s situation.

Encourage Families to Share Their Stories

Many family patriarchs and matriarchs, especially those who immigrated to the U.S. or opened a business, overcame significant challenges in order to build a strong foundation for their families. Understanding their family history can be a meaningful lesson for children. Encourage your clients to share their stories in a way that educates, inspires, connects and motivates the next generation. This can be done in a variety of ways, whether through a video, family meeting or collection of photos.

Offer Educational and Inspirational Resources

Families often hold annual retreats, trips or reunions, all good environments for clients to begin a discussion about estate planning. Offer to attend a family function to facilitate a discussion, and alert clients of financial planning seminars, events and educational speakers that can enrich their family gatherings. Suggest that clients hold an annual family financial planning meeting, which is an effective way for them to keep lines of communication open and ensure that beneficiaries understand the importance of being financially competent.

A well-crafted estate plan has incredible potential to shape and guide beneficiaries. Helping clients pass on their values legacy and family story is a powerful way to create a generation of productive, thoughtful and financially healthy heirs.

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