The College for Financial Planning announced Nov. 9 that it was offering a designation for advisors to assist unmarried heterosexual and same-sex couples with their financial planning needs. The college says the Accredited Domestic Partnership Advisor (ADPA) program is the first in the country designed to prepare financial advisors to meet the needs of lesbian, gay, bisexual, and transgender couples, as well as couples living in what it calls “other nontraditional arrangements.”
“We had a corporate client come to us and requested we develop this course for its employees,” says Gregg Parish, a professor of estate planning at the college who developed the ADPA curriculum. “The rights initially were exclusively theirs, but they have now reverted back to us to use publicly. It’s timely, because we see a growing unmarried senior population beginning to emerge as life spans increase.”
The ADPA core curriculum, which Parish calls a module, is split into four parts. The first, wealth transfer, deals with issues like the lack of the marital transfer deduction available from the federal government, which means unmarried couples will use transfer tax deductions quicker than married couples. The second part, tax issues, involves estate, gift and generation-skipping strategies.
“Surprisingly, not being married has benefits in this area, purely for financial reasons,” Parish says. “You’ve heard of the marriage penalty? It doesn’t exist in this instance.”
The third part deals with retirement planning and relationship issues.
“We have laws to protect the spouses of participants in qualified plans; not so for unmarried couples,” Parish notes. “This is where we emphasize the critical need for a domestic partnership agreement. They can’t have a divorce agreement if they were never married, so this will assist the judge in determining what each party was expecting from the partnership.”
The fourth part, planning for incompetency and end-of-life issues, doesn’t differ much from what married couples must address, he says, except in one important way. If the domestic partner is to act as an attorney-in-fact for the party in question, that must be spelled out well in advance.
“Although the issues don’t differ much from married couples when they arrive, unmarried couples must pre-plan to have the partner act as the attorney in fact,” he notes. “Without an agreement, it is highly unlikely a domestic partner will be initially considered, at least under most states’ existing laws.”
Available as either a self-study or an instructor-led online MENTOR course, the ADPA program provides advanced-level curriculum designed to augment a professional’s existing skills. To qualify, professionals must hold one or more of the following designations: CFP, CIMA, ChFC, CPA, AAMS, AWMA, CRPC, APMA or a J.D. Both versions of the course typically take 30-60 days to complete.
“As I plan for these issues moving forward, of course I would look for an advisor with this type of designation because it tells me they’re gay friendly and specialize in my type of needs,” says Mary Vetter, a school teacher in Orlando, Fla. “Right now, my partner and I keep our finances separate for the most part, but as we look to buy a house together and as we get older, these issues will take on an increasingly important role in our lives. Properly planning for it will make it easier on everyone.”