Jun 1, 2010 12:00 PM

Prepare heirs to receive and manage the assets they inherit

By Vic Preisser & Roy Williams

In May 1976, radio broadcaster Paul Harvey began a series of five-minute vignettes entitled “The Rest of the Story.” It was so popular that it continued until his death in 2009 — a span of 33 years! He would recite what everyone “knew,” and then (after a commercial break) he would tell the “rest of the story,” usually about how crisis turned into triumph. Only at the end would he disclose the name of the actual person or event. The nation hung on to his every word, waiting and guessing as to whom he might be referencing in his story.

We have been researching the transitioning of estates for the past three decades. We're proud to say that we believe we know “the rest of the story” that occurs after an estate transitions. Sadly, the rest of the story doesn't have the Paul Harvey upbeat outcome. Unaddressed by families or their advisors, the rest of the story is that 70 percent of estates come unglued¹ after the estate transitions. Siblings sue one another, resign from trustee positions for fear of being sued, withdraw from family life or lose their assets. In many families, the only element upon which heirs seem to be able to reach agreement is a willingness to share the cost of hiring a “will buster” and advertisements in the rear of legal journals can be found boasting: “Come to our firm… We can break any Will.” To compound matters, research² also indicates that when parents passed away, the heirs “promptly selected their own (new) advisors,” leaving mom's and dad's advisors behind to solicit (new) replacement clients. This loss of client percentage (following an estate transition) has historically ranged from 90 percent to over 95 percent as separate wirehouses discovered when conducting their own confidential internal research. No one was retaining their client base, and the cost/time to replace that base was significant.

Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

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Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

E-Newsletter Signup

2011 Trust Glossary

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50 Years Ago This Month

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50 years ago, in May 1962, we featured articles such as: "Future of Canadian Trusteeship" by Arthur H. Mingay", "Training Trust Employees" by Ian M. Marr, "What is a Trust Officer?" by Eric J. Brown, and "Selling Services" by Donald I. Webb.

Conrad Teitell's Guide to Tax Benefits For Charitable Gifts

Click here to view the most up to date guide (September 2011)

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