Annual Survey Explores Themes and Challenges Affecting Estate Planning in 2019
CHERRY HILL, N.J. and NEW YORK, March 13, 2019 /PRNewswire/ -- For the second consecutive year, family conflict was identified as the leading threat to estate planning. According to a recent survey conducted by TD Wealth at the 53rd Annual Heckerling Institute on Estate Planning, nearly half (46 percent) of respondents identified family conflict as the biggest threat to estate planning in 2019, followed by market volatility (24 percent) and tax reform (14 percent).
The survey also explored the various causes of family conflict when engaging in estate planning, citing the designation of beneficiaries (30 percent) as the most common cause of conflict. Other leading factors included not communicating the plan with family members (25 percent) and working with blended families (21 percent).
"Family dynamics have always played a critical role in estate planning. As we start to see more blended families, we expect these conversations to become even more prevalent and challenging," said Ray Radigan, Head of Private Trust at TD Wealth. "Estate planning comes with the responsibility of motivating families to communicate through difficult times, which requires regular dialogue and complete transparency. To minimize risk, we encourage families to invite everyone to the table to participate in open and honest conversation about their shared goals and objectives."
Keeping an Eye on the Markets
Market volatility was top of mind for respondents in 2019, with nearly a quarter of respondents identifying volatile markets as the biggest threat to estate planning this year, up from 12 percent in 2018.
"It's not surprising that more planning professionals are keeping a close eye on volatility this year because many clients view lifetime gifting as an important component to their estate plan. These gifts, however, should only be made if enough assets are retained to provide support during retirement years. While market fluctuations are certainly worth watching and can cause concern for potential gift givers, we encourage our clients to keep a long-term view when investing and remember that short-term market movements are no match for a robust estate plan and a well-balanced portfolio," continued Radigan.
Giving the Gift of Trusts
The Tax Cuts and Jobs Act continues to have large-scale impact on estate planning. Following the increase in the federal gift and estate tax exemption, estate planners are introducing various strategies to allow clients to take advantage of the exemption. About one third of respondents (31 percent) propose clients consider creating trusts to protect assets, while 26 percent suggest clients plan to minimize future capital gains tax consequences and 21 percent agree to gift now while the exemption is high.
"Estate planners are now emphasizing the importance of creating trusts for the benefit of their loved ones so that assets can be protected from future claims," added Radigan. "For example, rather than provide a child with an outright gift or bequest, many parents are creating trusts as a means of protecting assets from future divorce claims. Additionally, these trusts can be used to ultimately protect loved ones from themselves or other loved ones."
Additionally, 40 percent of planners believe clients will continue to give the same amount to charities as they did in 2018, and 21 percent expect clients to donate more.
The total sample includes 105 survey respondents who attended the 53rd Annual Heckerling Institute on Estate Planning, including attorneys, trust officers, accountants, charitable giving professionals, insurance advisors, elder law specialists, wealth management professionals, educators and non-profit advisors. The survey was fielded January 16-17, 2019.
About TD Wealth
Through TD Bank N.A.,TD Wealth's Private Client Group and its affiliates work with mass affluent and high net worth individuals and institutions to help build, preserve and transition wealth. TD Wealth is committed to helping personal investors, institutional and non-profit organizations gather and potentially grow their assets by building long-lasting relationships, and is affiliated with one of the 10 largest financial institutions in the U.S., TD Bank, America's Most Convenient Bank®. From private banking, securities, investment advisory services, private trust, and estate planning, to institutional trust, including retirement planning, captive insurance and trustee services, TD Wealth creates and delivers customized and integrated wealth management solutions. Banking, investment and trust services are available through TD Bank. Securities and investment advisory products are available through TD Private Client Wealth LLC, member FINRA/SIPC (TDPCW).TD Wealth is a service mark of The Toronto-Dominion Bank. For more information, visit http://www.tdbank.com/investments.
TD Wealth is not a tax or legal advisor. You must consult with your own tax and legal advisors for specific advice pertaining to your estate planning needs.
About TD Bank, America's Most Convenient Bank®
TD Bank, America's Most Convenient Bank, is one of the 10 largest banks in the U.S., providing more than 9 million customers with a full range of retail, small business and commercial banking products and services at more than 1,200 convenient locations throughout the Northeast, Mid-Atlantic, Metro D.C., the Carolinas and Florida. In addition, TD Bank and its subsidiaries offer customized private banking and wealth management services through TD Wealth®, and vehicle financing and dealer commercial services through TD Auto Finance. TD Bank is headquartered in Cherry Hill, N.J. To learn more, visit www.td.com/us. Find TD Bank on Facebook at www.facebook.com/TDBank and on Twitter at www.twitter.com/TDBank_US.
TD Bank, America's Most Convenient Bank, is a member of TD Bank Group and a subsidiary of The Toronto-Dominion Bank of Toronto, Canada, a top 10 financial services company in North America. The Toronto-Dominion Bank trades on the New York and Toronto stock exchanges under the ticker symbol "TD". To learn more, visit www.td.com/us.
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