In reality, every financial planner giving advice related to retirement accounts, be they IRAs or defined contribution plans, is actually giving their clients tax advice. This means knowledge of tax issues is essential for a good advisor.
3. Create a proactive timeline and revise estate and retirement plans.
Estate and retirement plans should be living documents, said Slott, and advisors should continually revisit their clients’ plans to make sure they remain relevant.
In particular, advisors should be cognizant of the age milestones that impact retirement accounts, like the 70 and one-half age requirement for required minimum distributions, or the 59 and one-half age threshold for non-penalized defined contribution plan and IRA distributions.
4. Hold family meetings to meet your new clients.
A family meeting can be the first step towards creating a sustainable practice, but it can also help clarify what happens with clients and their surviving family members after a death.
“These are fantastic to add 25 to 30 years of life to your business,” said Slott. “Always call in a family meeting.”
If adult children don’t know their parents’ advisors, and what is going to happen financially when their parents die, they’ll probably go elsewhere for their own financial advice and end up taking their parents assets with them after they’re inherited.
5. Use the beneficiary form and custodial document to gain access to assets
The simple act of revisiting a beneficiary form may dig up changes to a client’s estate and retirement plans that can help inform financial advice. Slott also noted that many advisors—and custodians, brokers and banks—fail to ask about and review beneficiary forms.