Home / In Practice / Start clients on values early to avoid ‘biggest fear’ upon wealth transfer

Praemium's Matt van Dijk sat down with Brisbane adviser Francis Rigby to talk about the most commonly unmet advice need in the country. Talk about values with your clients, Rigby said, and the rest will follow.

With the biggest transfer of wealth currently underway between generations, and a well-documented shortage of advisers available to service the adult population, estate planning expertise is a precious commodity.

According to Matt van Dijk, head of distribution at investment platform provider Praemium, “inherited estates and estate planning” is now the top unmet advice need in the country.

Speaking on a podcast with Francis Rigby, director of Brisbane advice practice Financial Advice Matters, Van Dijk (pictured) stressed that even for people that do have an adviser, planning for the transfer of wealth is “quite a sensitive issue” and one that needs to be approached with care.

That sensitivity is a major reason estate planning needs often go unmet, Rigby said. People are understandably uncomfortable talking about issues involving their own mortality, and when you combine that with another sensitive issue – money – getting people to open up becomes even more difficult.

Yet there is one thing Rigby believes all advisers should focus on when broaching the topic of estate planning. Talk about values, he said, and the rest will follow.

“The way I would approach it is actually talking about some of the important values you’d like to transfer on to your children,” Rigby explained. “I believe in starting as early as you can… and getting them to look at things like goal setting [and] understanding what’s important to them so they align their finances.

“Probably one is the biggest fears [involving] transfer of assets is that it’s all just going to get spent and wasted,” he continued. “So when you start to look at it from an education viewpoint [within] the family unit, you’re then getting that ability to broach the subject and ask: ‘What are some of the things that are important to you… for your grandkids, for your children, for yourself?'”

Once you ascertain what’s important to clients, he said, and the values they wish to pass on, that information needs to be integrated into the client conversation.

The adviser’s role in the estate planning “journey” is to get people talking, Rigby added, about topics they’re generally reluctant to talk about.

“It’s this idea around having a good healthy conversation where the adviser can step in and be that person to just maybe soften the conversation a little bit, creating more around the desire to… support family in a journey… as opposed to a point in time,”

Instead of looking at retirement and death as singular moments in estate planning, Rigby said, frame them as part of a process. “If you’re having conversations around a journey and preparing things in perpetuity, then you actually get a really good result.”

As ever, however, the trick is to get people talking and let the rest flow.

“What we’re working on and constantly evolving is the the art of actually having good conversations around values… and then tying in the financial side to those values,” he said.

“It makes it a lot easier to talk about that transfer of wealth, or transfer of assets… not necessarily when somebody dies, it could be a progressive period of time when they’re actually alive, and they can actually enjoy passing some of that money to their family, if that’s what they desire as part of their values.”