How to grow your estate planning practice

How do you eat an elephant?

It may seem an odd question — it was first posed by Bishop Desmond Tutu of South Africa, when he sought an amusing way to raise the spirits of his people during a difficult time. ” One bite at a time,” he said.

The same message applies to engaging Canadians in estate and legacy conversations. It may seem overwhelming, but it isn’t.

Consider a couple of statistics: an estimated 70% of Canadians don’t have a current and valid will; and 98% say they are going to appoint a family member as their executor.

Appointed spouses will only be able to act if the decedent dies prematurely, meaning the job invariably falls to the children. When the time comes, they can be sued personally in at least 18 different ways. They should consider filing up to five different tax returns. And in Ontario, they can be fined up to 3% of the estate and can go to jail for up to two years.

Seniors are handing their children a difficult, time-consuming job with no instructions and no ability to ask any questions. Advisors may want to talk to them about estate planning, but they don’t want to talk to us.

This is Tutu’s elephant. How can we take a bite?

The people who do want to talk to us about estate planning are the executors. They have vested responsibilities for successful estate settlement. They want to know if there is a plan in place, beginning with a current and valid will. They do not want to have to explain to their siblings that they sold the family cottage to pay the taxes on it. They want to know that everything possible has been done in preparation.

The good news is that they can motivate their testator parents to get interested in talking because, simply by virtue of their appointment, executors are among the most trusted and influential people in their testator parents’ lives.

The bad news is they don’t know they’ve been appointed because testators, generally speaking, don’t tell their executors.

So, how do advisors find the executors? By talking to people approximately in their mid-40s and asking them if they might, at some point in the future, be appointed as an executor. They quickly realize they have no idea and need to find out.

No one needs to die for these conversations to happen.

Once they do, everything changes. Now people are engaged in the conversation. Now you can have executor-testator reviews. Now you can do an estate liquidity analysis. Now you can talk about all the various tools at your disposal to ensure the estate is well prepared.

A lot has changed in estate and legacy planning. Segregated funds provide litigation mitigation. Permanent life insurance is a logical estate liquidity solution. Asset consolidation is a loving act of kindness. And referrals come naturally because everyone should be able to have an estate and legacy plan without a lot of stress.

This article is based on a presentation delivered by Mark O’Farrell at the National Estates & Legacies Summit.