Estate Planning Systems

By Attorneys Terry L. Campbell & Jennifer M. Jedrzejewski
Published in the Wisconsin Law Journal on December 6, 2006

A common challenge facing the practitioner new to the field of estate planning is developing systems to help clients, which in turn also help the practitioner in the planning process. The following article will outline some of the systems we use, which ultimately make the planning process move along much smoother. It is intended to assist the new practitioner or an established practitioner who wishes to incorporate more estate planning into his or her practice.

We believe it is a fair assumption that nearly every client needs a financial durable power of attorney, a health care power of attorney, and a will or trust. To accomplish a client's goal, the practitioner must educate the client, secure personal information and data, and review the client’s financial information.

One system to incorporate into your practice is a model educational letter, which may serve as your first main contact with your client. This model letter can accomplish the following:

Explain the durable power of attorney and health care power of attorney;
Start the client thinking about the choices for agent and substitute agent; and
Explain the purpose of a will or trust.

You can develop different versions of this model letter. One version of the letter, for example, might discuss estate taxes in more depth. The model letter also serves as a checklist for the practitioner. You know for certain that you have covered the basic information. It is our practice to also send out a second model letter that confirms the planning. This letter includes the following:

The documents to be prepared;
The choices for primary and substitute agents, personal representatives, and trustees;
The distributions to be made at death;
The tasks still to be completed by the client, i.e., providing beneficiary forms; and
The fees to be charged.

Another system we incorporate into our practice is to have every client complete an estate planning guide, which is an invaluable tool for any practitioner starting the planning process. There is no one correct format for the guide, but the general idea is that the guide will allow the practitioner to gather as much information about the client as possible. It is especially helpful when the client completes the guide and returns it before the initial conference so that you know something about the client’s background and can make appropriate recommendations. The estate planning guide will ask the client to provide his or her full name, address, telephone number, social security number, and date of birth. A thorough guide should also ask for the same information about any children, grandchildren, and other beneficiaries, as this will be helpful for planning purposes. It is particularly helpful to have this information in the event the client does any gift planning. The guide should also ask the client to provide the addresses and telephone numbers of any proposed agents for powers of attorney and personal representatives/executors.

The estate planning guide should ask the citizenship of the client. If one or both of married clients are not U.S. citizens, the marital deduction and other rules change, which will affect any estate tax planning the client may need to do. It is also important that the guide asks if the client has had a prior marriage, and, if so, if the client has children from that prior marriage. Is there a marital agreement in place? The type of planning that will achieve the client’s goals can change depending on circumstances such as these. Our guide also inquires about any disabilities, etc. among family members. Should a supplemental needs trust be discussed?

In addition to the information listed above, it is important that the estate planning guide asks the client to provide specific financial information so that the practitioner can compile a net worth statement. This will allow you to determine if estate tax planning is necessary and, if so, what type of planning to recommend. Additionally, knowing the types of assets the client has and how they are held will allow the practitioner to make recommendations that will coordinate how all property passes at death, such as through beneficiary designations and payable on death (POD) and transfer on death (TOD) designations.

Although the estate planning guide asks the client to provide their financial information, we also request that the client bring to the initial meeting copies of recent statements from any bank accounts, mutual funds, brokerage accounts, etc., as well as a copy of the deed and most recent real estate tax bill for any property the client owns. Paperwork today is more confusing than ever. Reviewing the actual statements gives you an immediate opportunity to catch titling mistakes, i.e., an account perhaps inadvertently just in the name of the husband, etc.

We ask that the client confirm the primary and contingent beneficiaries designated on any retirement accounts, insurance policies, and annuities. Additionally, we request that the client bring to the initial conference blank beneficiary forms for any of the above referenced accounts. For an estate plan to work properly, it is important to coordinate the distribution of property at death. Proper beneficiary designations are also valuable in the administration of a client’s estate as they can reduce or eliminate the need for a probate. Thus, it is crucial that these designations are established correctly. If a change does need to be made to the beneficiary designation on an account, we will complete the change of beneficiary form and submit it to the respective company. It is our practice to submit not only the original change of beneficiary form, but also a copy that we request the company file stamp and return to us.

Having the client provide their financial information on the guide as well as provide copies of recent statements at the initial meeting also allows us to see where the client has assets invested and how they are titled. If, for example, upon review of this information, it is apparent that the client has several shares of stock held in certificate form, we may recommend that the client submit these shares to be held in book entry form or street name. This simplifies the client’s finances and helps the client know what he or she has. It also allows for an easier administration of the client’s estate down the road. If a client has money spread out over multiple banks, we will determine with the client if it would make sense to consolidate into one or two banks, again for ease for the client. A client who has assets spread out over numerous banks and financial institutions has a hard time keeping track of everything he or she owns. It also makes it more difficult to ensure that all assets are titled correctly and beneficiaries are listed correctly. We will often recommend the client consolidate his or her assets.

Systems will initially take time to develop. However, there are plenty of resources. Our Estate Planning Guide can be accessed on our website at www.lawmwc.com. Eckhardt’s Workbook for Wisconsin Estate Planners (4^th ed. 2003) by Mark J. Bradley, et. al and Wisconsin Probate System: Forms and Procedures Handbook (rev. ed. 1996) by William F. Mundt, et. al are excellent resources. Chapter Two of Eckhardt’s Workbook for Wisconsin Estate Planners, for example, discusses the information-gathering process and provides a sample guide that the practitioner could use to gather estate planning information. Additionally, throughout the book, practice tips, checklists, and sample letters are provided, which can be helpful to the practitioner. Wisconsin Probate System also provides helpful sample letters and is a great resource when assisting clients through the probate process.