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There’s more to a clients’ material wealth than just cash. Of course, we all know and plan for clients’ stocks, bonds, and real property. But one of the often overlooked assets is frequent flyer miles.
As you know, airlines and affinity credit cards have been battling each other for years to gain the loyalty of customers and to reward customers with frequent flyer miles.
So, your clients who are or have been frequent flyers are sitting on hundreds of thousands of miles that are good for many round-trip tickets to faraway destinations and other perks. In fact, even clients who have never strayed far from home may have hundreds of thousands of miles from credit card and other programs. Many of these people have so many miles they don’t know what to do with them.
Here’s a way to offer more value to your clients: Look into the fine print of programs used most frequently by your clients. You’ll likely find ways to pass the perks on, either now or after the client passes away. A bit of planning could make the clients’ loved ones and the client pretty happy. After all, a nice trip usually results not only in a positive experience but a lot of memories too.
Some miles programs are pretty liberal when it comes to using miles for other people. The Southwest Airlines Rapid Rewards program, for example, lets people redeem a ticket and book the trip in someone else’s name. So maybe the grandkids can fly to visit your client after all.
Other programs allow anyone who has the account holder’s username and password to book a ticket. If a program has this rule it’s a good idea for the client to make a note of login information so others can access it. No sense in those miles being wasted!
Another idea is to check to see if family members can be added to the credit card account. This way, as a secondary cardholder, others can access benefits such as flyer miles. (Maybe the account holder gets a relative a card, makes a note in their Will, then, just keeps the card in a safe place. Of course, the client needs to be careful since they may be responsible for any charges the relative makes on the card.)
Some airlines such as American Airlines allow the transfer of miles to the account of an heir if a Will or an Estate Plan mentions the gift. Continental has the same provision. United Airlines Mileage Plus Program says that mileage isn’t transferable upon death but a watchdog group says that United miles can actually go to a beneficiary for a fee. Cathay Pacific allows transfer of miles in blocks, for a fee.
Most of us probably don’t even think of frequent flyer miles as valuable assets. But, when you think about it, they really are. 250,000 miles can get 10 roundtrip tickets anywhere in the U.S. on most airlines. That would be worth $3,500 if the average fare was $350. However, the miles may be worth even more if used for business or first class tickets.
Doing a bit of planning on the transfer of miles is pretty easy and it can come as a pleasant surprise to clients and their loved ones. So maybe your client’s son-in-law can make it to Graceland after all.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
One Academy Member submitted a question about how to bump probate business up a notch. Some of our suggestions included the following:
Some Members get a lot of Probate business from Google searches. Take a look at your website rankings to make sure you are visible with probate keywords. If you use Google Ads, make sure they have probate rich keywords in them and that the ads link to a Probate related page offering a Probate report. We also suggest you take a look at testing Facebook ads, they are lower priced than Google ads and you can have the ads show up based on keywords people use on their wall or in their profile.
The other area to look at is your own client base:
- Create an email to feature a PROBATE NIGHTMARE AVOIDED story or a CLIENT CASE STUDY CLIFF NOTES (names have been removed to protect client confidentiality)
- Client mailings should offer to walk clients through “how to subscribe to our blog,” “how to like us on Facebook or explain how your kids can” and also “if you or your friends or family need our free Probate report — call this hotline!”
- Client seminars should have a featured 10 minutes for you to tell a sad story that has happy ending for a family you helped through probate – “this is how you recognize someone in your life who needs to call us and this is how we treat them”
Marketing for business from people you don’t know is critical, but without developing the story you tell and slowing down to drive a point home with all those you already know – it’s only going to represent a fleeting blip in activity.
Jennifer Price
Director, Member Services
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
After coaching law firms for almost 20 years, we’ve discovered that most estate planning practices fail or don’t live up to the owner’s expectations because of the failure in these 7 critical areas:
- No unifying vision, purpose, or principles that motivate the firm beyond just making money
- Failure to effectively communicate the firm’s mission to the staff, vendors and clients
- Few consistent management systems that deliver reliable results
- Relying on specific employees, rather than viewing the firm as a collection of functions
- Failure to focus sufficient resources on filling a pipeline with qualified prospects from multiple marketing sources
- Inadequate capitalization and access to lines of credit
- Owners focusing on the technical, rather than the strategic work of running a business
There are, of course, many more important areas that deserve attention, but mastering the top 7 will almost guarantee that you dominate your market.
Robert Armstrong
President & Co-Founder
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
It seems there’s a shifting tide in the way wealthy Americans feel about transferring their financial wealth to their children. And the kids may not be ok with this.
While many financially wealthy parents do plan to leave a tidy financial inheritance to their children and / or grandchildren, there is also a clear, growing trend that “the kids need to work hard and make their own money.”
It used to be that parents felt obliged to leave their financial assets to their children, as well as their values. In fact, many of these parents sacrificed a great deal for their children and did not tend to “live it up” in their later years, to make sure they would indeed be able to leave a nice sum to their kids.
But many of the wealthy amongst the baby boomer generation have a much different attitude. They feel “I made it on my own; they can too.” In fact, they believe that their children might be harmed by being left a large inheritance. They believe that the children might best be prepared for life by being given solid values, a good education, and a more modest nest egg.
Maybe people are following the likes of Warren Buffet and Bill Gates: these super-rich guys plan to leave only a small fraction of their wealth to their children. A recent research study confirms this is indeed a trend. Conducted by U.S. Trust, the study found that less than half of wealthy parents thought it was important to leave their money to their kids.
The survey of 457 individuals, who each had $3 million or more in investable assets, concludes that more wealthy Americans want to spend their money on themselves while they can, then leave what’s left to charity, not just to their children.
Why?
Many of the survey respondents were baby boomers who sacrificed and struggled to make it on their own. Many built up successful businesses. But it also seems they are not all that confident that money they leave would do a great deal of good:
- 34% feel that their children would not be able to handle an inheritance
- 24% fear their kids would become lazy
- 20% believe their kids would make poor decisions
- 20% feel their kids would squander the money
- 13% believe their children would be taken advantage of by outsiders
There are many variations on the theme: some wealthy families will leave some assets to their children and the rest to charity, or perhaps leave a lot to their grandchildren and none to their kids. Of course, the use of trusts can also ameliorate some of the concerns expressed by those in the survey
However, there’s little doubt – as evidenced not only by the U.S. Trust survey but also from talking to estate planning and asset management firms across the U.S. – that many baby boomers have a much different take on transferring wealth as compared to previous generations.
What is your experience? Have you seen a shift in attitudes?
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: 858-453-2128
www.aaepa.com
Is your staff saying they are too busy, have too much on their plate, can’t possibly handle another responsibility? Well, before you rush to hire a new staff person, you may want to look at your current employees’ productivity and its impact on your revenue.
One benchmark we analyze on financial review calls and strategic planning calls with Members is revenue per person on the payroll. We look for a minimum of $130,000 per person annually – this includes everyone from the receptionist to the attorneys. Of course, part-time employees count as a fraction of a full-time employee. Let us know if you want the exact formula for calculating the number of people on your payroll.
We often see the revenue per person on the payroll for law firms range anywhere from $80,000 to $250,000 – both the bottom and top end of the scale are a red flag and prompt a conversation about the cause and impact on the health of the business.
If your revenue per person is under the benchmark, it could be caused by:
- Inefficient Systems: Your systems for producing the work aren’t effective or being followed on a routine basis. Your staff may very well be busy, but it’s not a productive type of busy. Your systems need to improve and your revenue needs to increase in order to justify having that number of staff.
- Your fees are too low: This may mean that your staff is honestly busy, but it isn’t reflected in your numbers, because you and your staff are producing too much work for the money you’re getting paid. Before hiring anyone, increase your fees and see what impact it has on your bottom line.
- Untrained Staff: You may either have a lot of turnover with untrained staff or you could be adding a new service to your business that hasn’t been fully implemented.
- Wrong people on the bus: Your staff may not be in a position that takes advantage of their interests or their strengths. They may not be that busy and it could be time to reshift and reorganize those job descriptions. Is it just a job for them OR is it a career and they honestly care about the business and the families you help? Also look at their strengths and whether they’re in the right position to take advantage of them, there could be an opportunity to move them to a different position where they can be more productive. As Jim Collins explains in his book Good to Great, you have to get the right people on the bus and in the right seats, and the wrong people off the bus so that it will move in a positive direction.
If your revenue per person is hovering around $200,000 or more, you are taking some risks. Your office has systems in place and is operating like a well-oiled machine. Your employees are juggling a ton of balls and don’t have time to stop and think about the details or ways to improve what is currently in place. It could be time to hire a new staff person. Take out your organizational chart, talk to your current employees, and determine what the job description for that new hire will look like.
If you don’t make another hire, beware of:
- Systems falling apart: If you lose a key employee unexpectedly (they get sick, have an accident, move to a new city, have a baby), you won’t be able to continue at the same pace. Everyone is already operating at breakneck speed – they can’t possibly fill in for that missing employee and get all of their own work done as well. Balls will be dropped, clients may have to wait too long and get upset, all costing the firm referrals and money.
- Burnout: If everyone is consistently working overtime, 50 – 60 hours a week, how long can they sustain that pace and how long will it take before they look for another job?
If your staff isn’t productive, remember that you, as the business owner, are responsible for the leadership role in the firm and holding your staff accountable. You aren’t just an attorney meeting clients, you must have a vision for the firm with an organizational strategy that takes into consideration your short-term and long-term goals.
Lillian Valdez
Practice Building Consultant
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
Point A on the map can be where you are now in anything in your life or business… maybe it’s the number of Facebook fans you currently have, your current average revenue per month, or your weight this morning.
Point B is a little tougher to identify.
Determining the RIGHT goal for the period you’re working with is so important. In discussing goals with Members it’s clear that goal setting is one of the hardest responsibilities an attorney has. For example, the fact that someone may “need” to lose 75 pounds doesn’t mean that setting a goal to lose all of the weight by Sunday makes sense, just because there is a beach party that day.
When Sunday arrives and that person has lost 3 pounds, the truth is they feel like a failure, and will likely abandon their big goal. They’ve actually set the stage to fail in their goal because it wasn’t realistic.
It’s no less true when looking at your law firm revenue. When an attorney is currently grossing $300K per year and tells me that this year’s goal is to break a million, it prompts a long talk. Growth takes some intention. Looking at the revenue per person on your payroll now, how much more work can the current staff do? Most law firms we work with have evidence of a strong, experienced, competent group of attorneys and staff when they function at an average of $150K–$220K per person on the payroll. If your office is at that level and you doubled the gross—who’s going to do the work? How many more people would you need to hire? How long will it take through training and hands-on experience before they’re operating at the same pace as the longer term employees? And, do you even have enough space to hire more people?
Once you identify where you are now, and where you want to be in a particular timeframe, it is simply a matter of determining how you will get there. Identifying what you need for the trip, looking at your resources and mapping the course. This includes setting short-term goals as milestones for reaching your long-term goal… or time and intentional pit stops along the route to point B on the map.
Measuring your progress along the way and re-charting your course, if necessary, is an absolutely critical element in goal setting. You can’t possibly get to Point B without a map and looking at where you are each step of the way in relation to where you want to go, just as you can’t possibly lose 15 pounds without a scale.
Start with your vision, match that up to your desires and reality… write it down and then get started. See how things are going, make adjustments and achieve whatever you set your sights on!
Jennifer Price
Director, Member Services
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue Suite 300
San Diego, CA 92123
858-453-2128
www.aaepa.com
It seems we will find out the answer in the coming days. In Janson, et al. v. LegalZoom.com, Inc., (No. 10-CV-04018-NKL, W.D.Mo.), LegalZoom.com, Inc. faces a lawsuit alleging that it is engaging in the unauthorized practice of law, in violation of Missouri law. Originally, the case was brought in state court, but was removed to federal court, due to the diversity of the parties. Then, the federal district court certified a class action in the case, involving all those Missourians who have purchased LegalZoom products and services since December 17, 2004.
LegalZoom offers blank legal forms and document preparation services. The blank legal forms product offering is not a subject of the lawsuit. In the document preparation service, it prepares documents based upon the answers which users of their services provide to specific questions. Based on the answers to the decision-tree questions, the document is assembled by LegalZoom and sent to the user.
LegalZoom filed a motion for summary judgment in the case. Earlier this month, the district court denied the motion for summary judgment, with the narrow exception of matters relating to the preparation of items for patents and trademarks. The preparation of patent and trademark applications is a matter of federal law, which preempts state law regarding the unauthorized practice of law. However, the case is going forward as to the portion of the case concerning estate planning attorneys: The preparation of Wills, Trusts, and similar documents. Here is a link to the order on the summary judgment motion: http://www.directlaw.com/courts-order-in-LegalZoom.pdf
In denying summary judgment, the court stated, “a computer sitting at a desk in California cannot prepare a legal document without a human programming it to fill in the document using legal principles derived from Missouri law that are selected for the customer based on the information provided by the customer. There is little or no difference between this and a lawyer in Missouri asking a client a series of questions and then preparing a legal document based on the answers and applicable Missouri law.”
This seems to make quite a bit of sense. In other words, I could devise a program, using my knowledge of state and federal law, so that the end user could navigate a decision-tree to prepare a document. However, it is the construction of that decision-tree that requires knowledge of law.
Assuming that, after a trial on the matter, the court finds that LegalZoom has engaged in the unauthorized practice of law, what is the likely outcome? Of course, the court almost certainly would enjoin LegalZoom from selling its document preparion service in Missouri. However, there also is a real financial deterrent: The Missouri statute provides for treble damages. Further, it is likely that similar actions would move forward in other states, at least those with similar statutes concerning the unauthorized practice of law.
What do you think? Is LegalZoom engaging in the unauthorized practice of law?
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue Suite 300
San Diego, CA 92123
858-453-2128
www.aaepa.com
The International Cemetery, Cremation and Funeral Association recently held their summer university. I attended the ICCFA University College of 21st Century Funeral Services and came away with a new perspective on how funerals are changing.
Dr. Alan Wolfelt, a psychologist trained in life transitions who spoke there, said, “More and more people in North America are asking ‘Why have a funeral?’”
People are saying, “When I die, just get rid of me no muss, no fuss. Maybe have a party, but I sure don’t want a funeral.” “Dad said he didn’t want us to go to any trouble, so we are just going to do what he said.” “We just thought it would be easier, faster, and cheaper.”
Wolfelt said that efficiency should not be confused with effectiveness. He said, “We’ve gone from funerals to memorial services to celebrations to parties. In the process, we have lost the connection to grief and emotion.”
People are losing sight of the value of holding some kind of ritual service, a safe place to grieve and mourn. Very often, the people who don’t recognize a death with a funeral or memorial service are in a psychologist’s office six months later with problems related to unexpressed emotions.
We in the U.S. have become an increasingly “mourning-avoidant” culture, where people tend to want to avoid sadness. At a meaningful funeral, people laugh one moment and cry the next as they share stories that cause laughter as well as tears. This experience of “paradoxical emotions” results in what Wolfelt calls the “sweet spot of emotional experience.”
Traditional clergy doing cookie-cutter funerals with little relevance to the deceased or their family have also contributed to the decline of funerals. Wolfelt and Doug Manning, founder of the In-Sight Institute (which certifies nondenominational “Funeral Celebrants”), both noted the declining number of Americans who attend church and the growing number of interfaith families.
The 2010 American Religious Identification Survey estimated that approximately 15% of the American population do not attend religious services or consider themselves church affiliated. If you grouped all the identified “nones” into a state, it would be the second largest state in the union, right behind California and before Texas.
In our highly mobile society with fewer ties to church or a specific religion, there is a growing corps of Funeral Celebrants who can offer families a personalized and individualized funeral or memorial service experience.
A Funeral Celebrant is trained in the specific area of conducting funerals and memorial services for families who are not affiliated with a religion or theology. Celebrants can assist a family with no clergyperson, as well as those uncomfortable with traditional religious funerals, on whom to call when there’s a death.
The use of Certified Celebrants originated in New Zealand and Australia, where 80% of the population chooses cremation and many people do not attend a church. Civil Celebrants, who are licensed by the government, perform over 50% of the funerals and weddings in those countries.
Doug Manning brought the idea of Certified Funeral Celebrants to North America in 1999 when he founded the In-Sight Institute. In-Sight has certified more than 1,600 Celebrants across the U.S. and internationally.
Another 36 Certified Celebrants graduated at the end of this ICCFA University. I’m proud to be one of them.
Gail Rubin, Certified Celebrant, is author of A Good Goodbye: Funeral Planning for Those Who Don’t Plan to Die and The Family Plot Blog (http://TheFamilyPlot.wordpress.com). She provides the information, inspiration and tools to pre-plan thoughtful and meaningful funerals or memorial services. Her website is http://AGoodGoodbye.com.
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue Suite 300
San Diego, CA 92123
858-453-2128
www.aaepa.com
I recently received an interesting HubSpot blog on the topic of spelling and grammar errors in marketing and office communication with clients. The question posed was, “Should spelling just not count as much these days?”
The question alone raised the hair on the back of my neck! I couldn’t WAIT to respond with my two cents… but I did. As it turned out, it’s fine that I waited. There were over a hundred comments, (some with misspellings), ranting about how unforgivable it is to have any such errors in our internal communication with staff or our email or postal correspondence with clients. Slow down. At the very least turn spell checker on.
The truth is, the devil is in the details. If your firm can’t spell or speak intelligently, how can a client or referral source trust your firm to do anything bigger than knowing the difference between “to” and “too”?
There is a wonderful publication that I’ve subscribed to for ten years or more called “Law Office Administrator.” Inside the front cover of this printed newsletter is an article called, “On Better Communication.” It contains tips for grammar, such as how to avoid the overuse of certain words, how to use correct punctuation, and how to correctly spell the most commonly misspelled words (my pet peeve is stationary… unless your office letterhead is sitting *very still* on your desk, it should be spelled stationery.) Most of us here enjoy routing that article; it raises great discussions and reminds us all of some of the good habits we may have drifted away from.
To quote an example given in one of these Law Office Administrator articles:
- Very. Always take it out. No matter how or where it’s used, it’s better gone. It’s very hot today. I’m very tired. This concept is very difficult to explain. What does very add? Not much. The same is true for really. Really hot doesn’t make it any hotter, really tired is no more tired than tired, and difficult is no easier than really difficult.
Putting structures around us will help to make sure spelling and grammar work in what we write. Grab the old reliable Strunk and White, find blogs on writing tips, put a line item on your law firm meeting agenda to recognize something that was written well or to highlight a “tip”.
Consider developing ground rules to write by, such as:
- Spell check should always be turned on!
- Never trust auto-fill if you’re using an iPad or smart phone.
- Have someone else proof what you’ve written.
- Don’t be hard-headed about others editing your work.
- Learn from the mistakes you make and get better at it.
- Be a vigilant proofer of whatever you’re reading and coach your staff effectively.
Are there any particular hot buttons that turn your head when you open an email or proof something just before it goes out the door?
Jennifer Price
Director, Member Services
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Ave Ste 300
San Diego, CA 92123
858-453-2128
www.aaepa.com
Estate Planning is the intersection of many different areas of the law. Of course, an Estate Planning attorney should understand Probate and Trust Law. And, Estate Planning attorneys must understand Estate & Gift taxes, at a minimum. Of course, it is generally expected that they will have somewhat broader knowledge of Tax Law. On the other hand, there are some areas of the law that we certainly are not expected to understand. Criminal Law is a good example of this.
Arguably, Prenuptial Agreements fall in a grey area. They certainly can affect traditional areas of Estate Planning, such as the disposition of assets at death. But, they also tread on traditional areas of Family Law, such as the disposition of assets upon divorce.
The requirements and validity of Prenuptial Agreements vary significantly from state to state. What would work in one state will not work in another.
For example, if you were doing a Prenuptial Agreement for someone, how much information do you have to give to the intended spouse? Must you reveal “expectancies?” The answer depends on the state.
Must both sides be represented by counsel? The answer depends on the state.
There’s a long list of such items that vary by state. And, the requirements in practice may differ somewhat from what a cursory reading of the law might reveal. Certainly, an Estate Planning attorney must learn such things before being able to practice competently in the drafting of a Prenuptial Agreement.
Do most Estate Planning attorneys draft Prenuptial Agreements? Some attorneys have told me that they do so routinely. Others do not feel comfortable doing so.
What about you? Do you think Estate Planning attorneys should draft Prenuptial Agreements? Do you draft such agreements?
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Ave Suite 300
San Diego, CA 92123
858-453-2128
www.aaepa.com
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