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Voices is an occasional column that allows wealth managers to address issues of interest to the advisory community. Mark Powell is an attorney at Irvine, Calif.-based Albrecht & Barney and the founder of Practical Plans.
I have two kids, and I can remember when they were very young that just sorting out the feeding, changing, and scheduling was overwhelming. It was hard to figure out how I was supposed to get to the end of the day let alone think about the future.
While this is the case with many young parents, it's also a prime time for advisers to help them put together an estate plan that includes what the parents want their children's future to look should something happen to them.
I think a lot of advisers will assume there's no way to know how the world will be when a child grows up. So when drafting a plan they'll tell their clients to plan for numerous things that could happen; for example, what happens if my child develops a gambling problem? But my feeling is that for parents who are already overwhelmed this can be too much.
Instead, I recommend people create estate plans that include provisions for the most likely events in their children's lives, such as college and marriage. Plan for what happens when both parents are alive and well, what happens after the death of the first parent and what happens should both die. Plan broadly at first, and then you can decide what specific things you want to include in an estate plan.
To get more specific, I ask people to write down their wishes for their kids in five, 10, 15, and 20 years. You'll find that a lot of clients have the same goals--like sending their kids to college or helping them get married. But you'll find that some clients will surprise with something very different that they want for their kids--and this can give you a jumping-off point to make more specific plans.
As an adviser, this will help you pinpoint exactly what kind of planning you need for them. If both parents went to state schools and would be happy if their children went there, that's a very different kind of planning than parents who are only interested in exclusive private colleges.
http://online.wsj.com/news/articles/SB10001424052702303933104579304593018595748
Voices is an occasional column that allows wealth managers to address issues of interest to the advisory community. Mark Powell is an attorney at Irvine, Calif.-based Albrecht & Barney and the founder of Practical Plans.
I have two kids, and I can remember when they were very young that just sorting out the feeding, changing, and scheduling was overwhelming. It was hard to figure out how I was supposed to get to the end of the day let alone think about the future.
While this is the case with many young parents, it's also a prime time for advisers to help them put together an estate plan that includes what the parents want their children's future to look should something happen to them.
I think a lot of advisers will assume there's no way to know how the world will be when a child grows up. So when drafting a plan they'll tell their clients to plan for numerous things that could happen; for example, what happens if my child develops a gambling problem? But my feeling is that for parents who are already overwhelmed this can be too much.
Instead, I recommend people create estate plans that include provisions for the most likely events in their children's lives, such as college and marriage. Plan for what happens when both parents are alive and well, what happens after the death of the first parent and what happens should both die. Plan broadly at first, and then you can decide what specific things you want to include in an estate plan.
To get more specific, I ask people to write down their wishes for their kids in five, 10, 15, and 20 years. You'll find that a lot of clients have the same goals--like sending their kids to college or helping them get married. But you'll find that some clients will surprise with something very different that they want for their kids--and this can give you a jumping-off point to make more specific plans.
As an adviser, this will help you pinpoint exactly what kind of planning you need for them. If both parents went to state schools and would be happy if their children went there, that's a very different kind of planning than parents who are only interested in exclusive private colleges.
http://online.wsj.com/news/articles/SB10001424052702303933104579304593018595748
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