Growing Your Financial Advisory Practice | Insights for Financial Advisors, Planners and Investment Managers
028: Estate Planning in Accordance with Clients’ Values
An effective financial advisor does more than help their clients prepare for their own futures: they also help them allocate their assets in accordance with their values. Today’s guest is here to share how he helps his clients live by their values, from setting their goals to planning their estates.
Sterling Rempel has more than 30 years of experience in the financial services industry. Twenty years ago, he founded his own independent financial planning firm, Future Values Estate & Financial Planning, where he serves as the principal advisor.
Sterling is a Certified Financial Planner, holds the distinction “Fellow of FPSC” and is a two-time finalist in the PlanPlus Canada Financial Planning Awards. Listen to the episode to hear what he has to say about estate planning practices, the importance of education for bringing in new clients, and more.
What You’ll Learn in This Episode:
- What planners get wrong about the financial planning process (7:05)
- The three questions to address in estate planning (10:50)
- Sterling’s transition from mutual fund dealer to securities dealer (18:15)
- How Sterling has evolved his methods for finding new clients and leads (23:25)
- Sterling’s “fee-agnostic approach” to pricing (25:55)
- The ongoing opportunity for advisors in an increasingly tech-driven industry (29:55)
- Why successful advisors are never satisfied (33:10)
Links and Resources:
Quotes by Sterling:
“Estate planning is more than the tax and the charitable giving; it is how to transition that wealth to the next generation most effectively.”
“I find that clients aren’t as hung up on the nature of the compensation, more so they just want to understand it.”
“We as an industry have to do a better job of identifying that financial planning is a valid exercise no matter what a person’s financial net worth statement says.”
Celebrating 20 years as an independent financial advisor this year, Sterling Rempel jokes that he thinks he “might survive in this industry at this point.” Far more than surviving, he’s built a successful business doing what he loves and helping people feel confident in their financial future and the legacy they’ll leave behind.
Below, we’re sharing three key ideas from Sterling:
- The first step of financial planning: How Sterling identifies values and goals
- Three critical questions to address in estate planning
- What Sterling wishes he knew about transitioning from mutual fund dealer to securities dealer
For the rest of the episode, find the podcast on iTunes or Stitcher, or click the link above.
The first step of financial planning: How Sterling identifies values and goals
Sterling has always been a believer in the importance of values ‒ the name of his company is a nod not only to the financial concept of future values, but also to the critical role a person’s values play in financial planning.
So when he’s working with a client, that’s where he begins. He leads them through a values exercise from Think2Perform, which gets them to narrow a list of about 50 values down to 5. This (often challenging) exercise gives him insight into who they are and what drives them.
Next, he learns about his clients' goals ‒ and, often, helps them uncover goals they didn’t realize they had. He uses a goals-based exercise where he has his clients fit different activities into one of four quadrants: things they want to do now, things they want to do later, things they feel they have to do now, and things they feel they have to do later.
These activities help crystalize ‒ both for Sterling and for the clients themselves ‒ what motivates them and what they’re working toward.
Hint: For more on helping clients manage their finances in alignment with their values, listen to our episode with David O’Leary.
The three questions to address in estate planning
When thinking about their financial future, there are three questions people tend to ask:
- “Will I be ok?”
- “Will my family be looked after?”
- “How can I give back to my community and to causes that are important to me?”
But they can’t get to the second and third question until they’ve confidently answered the first ‒ so you need to determine their core capital needs and whether they’re meeting them. Then they can look at being generous with their family and friends.
One easy way to start the process is by looking at the client’s past tax returns ‒ what kinds of charitable donations have they made already? That gives a start for identifying what causes are important to them. Beyond that, it’s critical to probe the client to help them decide where they want their money to go when they’re gone.
Identifying how one wants to give back is just as personal as the values and goals exercises discussed above. “That charitable giving conversation arises out of the most important part of people’s hearts,” Sterling says. “What is it that they care about? What is it that they love?”
Once a client has identified who or what they want to leave their money to, your job is to help them do it in a way that makes sense.
One key aspect of this, of course, is identifying tax liability and addressing strategies to mitigate it. But it goes beyond that, too. “Estate planning is more than the tax and the charitable giving; it is how to transition that wealth to the next generation most effectively,” Sterling explains.
For instance, in Sterling’s experience, leaving a 16-year-old a large sum of money can actually do more harm than good because someone that young just isn’t ready to manage a lot of wealth ‒ looking into a trusteeship or annuity opportunities is usually a good idea in these cases.
What Sterling wishes he knew about transitioning from mutual plan dealer to securities dealer
Sterling’s decision to transition from the MFDA platform to the IIROC individual securities platform is a bit of an unusual one. However, he felt it made sense for his business for the following three reasons:
- His ability to better serve current clients: Sterling had clients he couldn’t fully serve in all areas. Now he can serve clients with individual securities and ETFs, and most importantly he has greater flexibility around structuring any client portfolio.
- Fewer missed opportunities: Sterling noticed that though he had a great rapport with some ideal potential clients, he was missing out on their business because they weren’t willing to move their assets into managed funds.
- Business continuity and succession: While Sterling loves his work and has no desire to retire anytime soon, he wants his clients to have peace of mind knowing that they’ll be taken care of when he eventually leaves the business. To that end, he’s working with another team to determine business continuity, and his transition has made that relationship possible.
A challenging transition
The move, though, wasn’t as smooth as he’d hoped. For one thing, he was dealing with a health crisis through the summer, and that made things a lot more difficult.
But for another, he had underestimated how much time the transition would take him ‒ the onboarding and paperwork ended up being full-time work for him and his three staff. As a result, he had a lot less time to attend to his insurance clients.
He says he wishes he had known the extent of the impact in terms of time and income in advance ‒ but all that said, he’s glad he made the transition.
To hear more from Sterling, including more of his thoughts on estate planning, the importance of your business name for succession planning, and his “fee-agnostic” approach to pricing, catch the full episode here on this page. You can also subscribe to the show on iTunes or Stitcher and sign up for our mailing list below to ensure you never miss an episode.
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