Developing an intergenerational strategy

‘Lifetime value’ is a term most professionals in estate planning will be familiar with regarding their clients, but there is a lesser known term to consider: ‘post-lifetime value’.

Businesses often focus on the front-end costs of attracting new clients rather than the opportunities associated with perfecting long-term relationship-building with existing ones. This approach tends to lead to a client half-life that expires when they do, resulting in a finite end point to the client relationship. However, this doesn’t have to happen.

Relationships formed by estate planning professionals are often limited to the ‘key contact’ – their client – with little or no engagement with or from the client’s wider family circle. In many instances this is a commercial misstep since the value of investing in intergenerational relationship building could be significant.

In addition to securing probate and estate administration work, engaging with relatives can help to lay the relational groundwork that enables you to follow your client’s assets as their estate passes into new ownership. This provides continuity of oversight with a new generation of clients who might otherwise have been persuaded to shop around or even handle all the legal and financial matters themselves using ‘online solutions’.

If we were to plot the lifetime value of a client – measured by the fee income derived from them over time – it would likely be heavily skewed towards the right of the graph, due to the lucrative nature of probate compared to that of wills and trusts. Because of this, a will bank represents future opportunities for solicitors with an eye on both client lifetime and post-lifetime value optimisation.

The risk of not including a client’s next of kin in your conversations, and preferably in your relationship-building strategy, is the possibility that they may choose to instruct another firm to help them with probate, attempt to do it themselves or challenge you as the named executors. By laying the foundations for an ongoing association it may be possible to secure further work in the future. The chances of being instructed to support estate administration and to continue advising a client’s beneficiaries can yield significant dividends in the long run.

So, how can you work towards securing the intergenerational new business of tomorrow?

To draw your client’s beneficiaries closer throughout their lifetime, try to:

• encourage your client to include their beneficiaries within the wider conversation
• initiate discussion as to who would look after their day-to-day financial and legal affairs should they become unable to do so
• ask about legacy planning, inheritance and digital asset management, and
• encourage your client to consider the convenience of having all their important information, for their life and legacy, in one secure place so that when they pass, loved ones will know where to look.

Including a client’s beneficiaries in discussions like this can be an important opportunity to evidence your expertise to an expanded audience that one day will likely be the custodians of your current client’s assets.