The late Zappos founder Tony Hsieh, 46, left no will, no trust and no instructions for the disposition of his vast fortune when he died recently. Settling his estate will be a long and complex process.
Any person with assets who dies intestate is likely to leave behind a snarl of complexity for survivors, and the more significant the assets, the greater the burden. This is where advisors and their help can prove most valuable.
Conversations about death and money are better had sooner rather than later, but clients often prefer to avoid the topic. How should they be framed?
Many advisors focus on asset transfer, or who gets the money.
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Instead, “Try starting conversations by asking clients what they would like their legacy to be and where they would like their influence to be felt in the future,” says Toby Mathis, a founding partner, attorney and tax expert at Anderson Business Advisors in Las Vegas.
Framing the conversation in this way is psychologically less unsettling, yet it promotes a disposition of wealth that can be far more beneficial to future generations than a straightforward transfer, Mathis adds.
Michael Metzger of Lifepoint Financial Design points out that while introducing the topic can be difficult, “It’s important that clients understand that the conversation goes beyond talking about death. It’s more about providing comfort and security to loved ones.”
For advisors, the aim “is to come from a place of understanding and guide clients toward looking at the issue,” Metzger explains.
The word advisors and attorneys use over and over when describing how to best help clients is “legacy.”