Why You Need an Advisory Team for Your Estate Planning

August 17, 2012
Updated on December 9, 2020

Estate planning is not simply the set of documents your attorney prepares, nor is it the insurance you obtain or the investment strategy recommended by your financial advisor. Done properly, comprehensive estate planning includes legal documents and financial elements, but it may also include more, as the estate planning process often points out the need to plan for the following additional considerations:

  • asset protection during life and for heirs
  • retirement
  • providing for a surviving spouse in the event of disability or death
  • providing for a parent or a child with special needs
  • long-term health care costs
  • estate, gift, and generation-skipping transfer (GST) taxes
  • a business succession plan at your retirement, disability, or passing that could involve a family member, business partner, employees, or outside sale

To meet your needs and accomplish your goals, it may be necessary to grow your business, increase or adjust your insurance, and manage your investments in a certain way. Instead of consulting with various professionals at different times and stages in the planning process (often getting different opinions from each one), many people find they can benefit from having a team of advisors involved in the process from the beginning.

How a Team Approach Can Help

No one professional has all of the answers, and diverse skills and experience are necessary for the best results. The team approach also minimizes time and costs—with everyone involved from planning through implementation, they can work together and hold one another accountable.

Who Should Be on Your Team?

Your advisory team will likely include your estate planning attorney (who provides counsel and legal documents), accountant or CPA (who knows your financial situation, provides bookkeeping and tax advice), insurance agent or broker (who provides property, casualty, liability, and life insurance), investment advisor (who recommends investment strategies tailored to your financial goals), and possibly a professional trustee (if a trust will continue beyond your lifetime). If you are a business owner, a business attorney and valuation expert will probably be needed, as well as a business broker if the plan calls for the business to be sold at some point. Other advisors may also be included, depending on your specific circumstances and needs.

How an Advisory Team Works

The team will meet with you to help identify your goals and set priorities. At this stage, they should be asking more questions than providing answers. After this first meeting, they will typically meet without you to discuss how best to meet your goals, bringing their areas of expertise into the planning as they consider various legal and financial solutions. Then they will present their recommended plan to you, and with your acceptance, begin to implement the plan. From time to time, they will meet to monitor the progress and make any required revisions as your needs and goals change.

Benefits for Business Owners

Many business owners are so busy running their businesses on a day-to-day basis that they do not have the time, energy, or vision to plan for the future. An advisory team can help an owner change focus from how much the owner is making today to the future rewards the owner can be building for his or her family and retirement. The advisors can help the owner value the business, which allows them to project cash flow; plan for estate, gift, and GST taxes; know how much insurance to purchase; plan for compensation; identify how much collateral is available for financing and retirement planning; and monitor progress. Over time, the team can also help the owner prepare to sell the business to an outside buyer or transfer it to a family member by helping to grow the business, reduce debt, select the best corporate structure, develop management, and groom a successor.

Continuity for Your Family

Involving your family members will acquaint them with the members of your advisory team, help them to understand what is being done and why, and avoid confusion and distrust later. This approach will give your family peace of mind, security, and confidence during what can be difficult and uncertain times if you become disabled and after you pass away. Your advisory team can also ensure continuity for generations to come if your planning provides for minor children or grandchildren or beneficiaries with special needs.

Business, Estate Planning
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