THE FAMILY meeting is the No. 1 strategy I use and attribute the majority of my success to. It is essential for families to participate in, and it strengthens relationships with clients.

But family meetings only work well if you have the right process. I start with preparing for the meeting.

Setting the stage: Stressing the importance

I tell clients this is very important. “You took your entire life to build what you have, and you’re telling me your kids can’t take a couple of hours out of their day to make sure that what you worked so hard for stays in the family?”

They usually respond by saying the kids all have different schedules and everyone is very busy. I say, “Well, do your kids ever take time off work to go to a dental appointment with one of the grandkids? Do they take time off to go on vacation?”

“Well, yeah, they do that.”

“This is just as important, if not more important, than any of those things. We only have to meet once, and we’re done.”

Ground rules

Some clients are very private when it comes to sharing their financial details with their children, so I tell them we can just review this at 35,000 feet. Other clients want the kids to know every last detail of what accounts they have, why they’re set up the way they are, what their tax situation is, what their estate plan is and all that. Either way is fine; it’s just a matter of establishing those ground rules ahead of time.

Attendees

I really encourage it to be just bloodline — just the kids, not the in-laws, not the ex-laws not the outlaws. It’s just the bloodline, because one of the problems you’re going to have is that the in-laws are the ones who usually cause the wedges between family members. I don’t have a problem having a discussion with the in-laws if the parents are OK with it, but the initial meeting needs to be with just the kids. 

Scheduling

I tell them, “Look, if we’re going to try to make it convenient for all of your kids, we’ll be sitting here 10 years from now asking when we are going to get this meeting going.” I tell the parents they need to just schedule a date, and the kids need to arrange their schedule to be available.

They’ll push back a little bit, and I give them the ammunition that they need. “Tell your kids you’re having a family meeting regarding your estate plan, and if they don’t want to be part of your estate plan, that’s fine, they don’t need to show up for the meeting. But, if they want to be part of it, they need to be included.” There’s no kid who turns down that invitation. They obviously want their share of the inheritance.

Meeting agenda: Preparing and executing

I prepare for any meeting by creating an agenda. When I get in there, I’ve got in my head all the things that we talked about in the past, what the agenda is, what direction this meeting should be going, what the priorities are. I’m going to hit the ground running.

On the top, it’s going to be their address, their phone number and their dates of birth.

Then I have a section that indicates whether or not they’re a veteran, and we talk about the potential benefits they could have as a veteran.

Then we have the estate plan. I’ve got a summary of the trust when it was signed, who the successor trustees are, the backups, the financial powers of attorney and health care powers of attorney.

When I’m talking to the kids about this, they’re often thinking, “Why did they pick Johnny instead of Susie?” “Why’d they pick her instead of me?” My goal is to dispel all the myths of favoritism and get it all open on the table.

Next, I look at all the different insurance policies they have, whether it’s with us or an outside policy, if they want some of that reviewed. Now, if I have long-term care insurance in place, I’m going to spend some time here. I don’t want those kids to say, “Mom and Dad, don’t waste your money, we’ll take care of you.”

This is a chance to make sure the kids understand the value of that coverage, and that this insurance means they’re more likely to get an inheritance.

From here, you simply continue down the agenda. The way you organize your agenda is important. The way we do it in our office has been very efficient. If any information is in bold as far as notes are concerned, it’s something my staff says I might want to talk about. If it’s in bold and underlined, it means it’s something the clients brought up that they want to talk about.

The next thing I do is put my financial reports together. I like to put things in order of tax preferential treatment, so I’m showing Roth IRAs first, and then I’ve got a variable annuity in there, so we might have some income benefits.

Conducting the meeting

I get everybody in and sincerely thank the kids for coming. I tell them that I appreciate that they made time to come, as I know everyone has busy schedules. I tell them that their parents are important clients of mine and that my goal is to ensure we’ve put them in the best position to have a comfortable retirement.

“One of their goals is, hopefully, to be able to leave you guys some money when their time is done, and we want to make sure you have every opportunity to take advantage of some of the benefits we’ve put in place, so I really want to thank you for coming.” Set the tone, set it right.

The next thing I do is tell them my reason for doing this. I give them a little synopsis of my background and that I am a comprehensive, holistic advisor. I tell the kids what I’m doing for their parents and assert that what we do has value.

Then it’s time to gather some information. I start by asking the kids a couple of questions like, “Who’s going to take care of things if you’re not able to blink once for yes or twice for no?” I have to know how much money they have. I have to know what their tax brackets are. I need to know all of this stuff just for my own compliance. I need to know social security numbers. I need to know the beneficiaries.

Then I state that I want to apply for the job to be their advisor. It’s subtle, it’s smooth and it works very well. I typically get somewhere between 40% and 60% of the kids, and they’ll end up becoming clients immediately when the parents die.

We put together a red book, or what I call the owner’s manual, which clients fill out so the kids don’t have to rummage through the drawers and try to figure out what’s what. It gives them contact information, people they need to get a hold of and all of what they need to do when a parent dies.

My information is right on the front cover. That’s who I want them to call. I should be guiding them through the process, so it’s all there to keep this stuff tied together. And it often leads to a lasting relationship with the kids.

James Silbernagel is a 25-year MDRT member from Kewaskum, Wisconsin. Contact him at jsilbernagel@sgadvisor.net.