Helping Clients Avoid the ‘Big Reveal’

Families aren’t great at communicating about money. And, not surprisingly, very few families are willing to talk about death. So, when it’s time to tackle those two topics together, most clients feel completely unprepared and risk some very painful consequences.

Clients spend thousands of dollars carefully constructing wills, trusts and estate plans only to put little time and energy into communicating that plan to their heirs and family members. They’ve prepared the plans, but not the people—and the people react accordingly.

How often have you heard, “It wasn’t fair,” or worse, “I haven’t spoken with my brother and sister since that day?” Financial advisors should be aware of the immense power their clients have to inflict long-term family conflict and emotional pain when their estate plans, wills, and trusts are activated.

In business, we call this failure to communicate “The Big Reveal,” and it rarely works out well. Whenever we have a big project or are making significant changes for any client, we strive to bring people along throughout the project to facilitate discussion, ensure understanding and, above all, eliminate surprises. Nonetheless, some leaders still choose to work in private and reveal their plans at the end.

It’s the same with wills, estate plans and trusts, save for one critical difference: When your client has passed or is incapacitated, the opportunity to huddle everyone up to answer questions is gone for good. Your client can no longer share the rationale for the decisions made about who gets the assets and why. The final message is sent, and there’s no clarifying it.

Proper estate planning provides an important opportunity to make a lifetime of difference to your clients’ families. Here’s where you come in: by conducting periodic and thorough reviews of estate plans, trusts and wills, you can help your clients avoid mistakes or unintended outcomes as assets and families change through the years. There are two simple strategies to best prepare the family and lower the chances of family conflict.

First, the most effective guidance you can give is to avoid that “Big Reveal” by having your client sit down with their family and tell their story about their wealth. Their family needs to hear: How did they earn and save their money? How did they acquire their property? What sacrifices were made? What risks were taken and what painful lessons were learned along the way? What values guided them? How was this money managed? And, what goals do they have for these assets as they’re passed down? If assets are not shared equally, have your client explain why.

Ideally, your client will deliver their story to their relatives in a group meeting, so no one later says, “Hey, Mom and Dad told me something different.” Sometimes, family dynamics prevent this group approach. Nonetheless, your clients’ personal story is a powerful preparation tool. Your client will have the opportunity to answer questions, correct misperceptions and share the rationale for their decisions. Above all, they can share the heartfelt messages behind their gifts that will resonate throughout the years.

The second strategy preferred by some clients can be a less direct, but equally effective, approach. A written document, such as a "Family Wealth Mission Statement" or "Letter of Explanation," is a clear way to prepare your clients’ heirs. It gives them time to ask questions or engage professional experts to review and advise them. My "Family Wealth Mission Statement" makes it clear that caring for those in the family who cannot care for themselves comes first, education is the next priority and memorable life experiences as a family is third. This statement is a simple, single-page articulation that can provide clarification and guidance long before any disagreements begin.

These best practices can help your clients avoid “The Big Reveal” and give them effective options to prepare their heirs for the property and assets coming their way. Counseling your clients on this topic is an important way to make a real difference by avoiding the enduring pain and conflict that may come from not tackling those issues at the start.

Brad Wheeler is President of AssetMark Trust Company