Tom Rowan Breaks Down the Mystique of Estate Planning

Rowan: The biggest mistake is that people don’t do anything at all. They feel that there’s always time. The worst plan is to take no action and then have something happen and then it’s like, “Oh, gee, I didn’t know.” I’ve also found the main reason why people do not really address an estate plan is they don’t know where to go and who to trust. It appears that the higher the economic scale, so to speak, the more skeptical individuals are in trying to deal with professional advisors. And, hence, they just don’t do anything. Another mistake is that they put strategies in place maybe 10 years ago and think “I’ve already done my estate plan.” Tax laws have changed so many times through the years, and the fallacy is that “I did this once 15 years ago so I don’t need to do it again.” Incorrect ownership of assets is another one. Individuals just plod along in a marriage and say, “Well, my wife and I own everything together.” From an estate distribution strategy and trying to maximize transfers, that’s not good.

SMA: How do you motivate clients to implement your estate planning advice?

Rowan: I’m a fee-based planner. I find by charging that fee there’s much better chance of the client implementing those strategies because they paid for them as opposed to not paying for them. Also, I ask them very early upfront for permission to stay in touch once I present the recommendations. If they agree to that, I’ll routinely call and ask, “Did you contact the attorney yet? Do you want me to contact them for you?” That kind of stuff. If they don’t put the legal documents in place that revolve around the estate plan then they haven’t done anything to improve the situation.