It can be the easiest thing in the world to save those tasks you don’t really want to do until “tomorrow.” I can imagine that for most people, an initial assessment with a financial advisor is somewhere near the top of that list. However, I can recall a number of situations where an initial assessment really made a difference in a client’s life and financial situation and helped prevent leaving a legacy of financial complications. One client family a few years ago had a unique situation that demonstrates the need for and benefit of an initial assessment in attempting to minimize financial complications for their survivors.
When I first met this family, they had come to one of our workshops where they listed all of the assets they could think of. Their estimate was $250,000 in assets. When they made the decision to work with us and began bringing us all of the statements they received and other mail, it became clear that the husband had, over time, purchased a share here and there, and just kept everything he had acquired. After we had tracked down every investment, it turned out that he had quite a few, and they actually totaled over $1,000,000. Just to give you an idea how diverse his portfolio was, if you were to look across all of the investments held by all of our clients, he had 300 that none of our other clients had. Needless to say, it was an eclectic mix.
Early on, the advisor and I that were working with our new client realized that this diverse mix could potentially become a major problem for the wife should anything happen to the husband. In this situation, the husband was quite a bit older than his wife and he dealt with all of the family’s finances. If he died, each investment and all of the shares which were held in his name, could potentially require a death certificate and separate documentation to be transferred to her. Further, because no one was really tracking these shares, he had investments that he had forgotten about. This meant that his wife would also be in the dark about what was potentially out there in his name.
I immediately recommended to the advisor working with them that we pull everything into a single account. Initially, this was a great deal of work for us. Our staff tracked down every investment, worked with each of the companies involved, ultimately amounting to hours and hours of administrative work just to pull them into a single account. The difference was, when the husband eventually passed away, his wife had only one account to take care of during one of the most stressful periods in her life instead of nearly 400 different places and accounts to deal with to get the estate settled.
So many times, I’m not sure that a client realizes how important it was that we made that initial assessment. It is so difficult to look down the road with any clarity and see what a potential minefield their current situation might be. The husband would have never known how much work his wife would have to do just to access the investments he made. His efforts to ensure that his wife was taken care of ultimately could have been wasted. While this example is not typical, these are the types of situations we run across. Our experience helps us to look at a family’s current situation and see potential issues down the road. We can get to work right away solving a problem to try to prevent it from ever developing to attempt to assist you in not leaving a legacy of financial complications.
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