Sunday, June 13, 2021

Women Revamp Estate Plans During Pandemic, New Survey Shows

Job loss, salary cuts and workplace exits were big motivators, said their estate planning professionals.

Nearly 90% of respondents to TD Wealth’s recent annual survey of estate planning professionals said their female clients experienced negative workplace impacts during the pandemic, including job loss, salary cuts and exits from the workforce. In turn, 87% of the respondents (certified estate planners, estate planning attorneys and trust officers) said they altered their female clients’ estate plans to accommodate their new financial status.

Although the survey did not ask respondents whether their practices are targeted toward clients over 50, “I would think that maybe the bulk of them were,” Kalimah White, a wealth strategist at TD and a senior trust advisor in its Delaware market, told Rethinking65. “For trusts and estate attorneys, that’s sort of the wheelhouse. People don’t really think about these things until around 40, 45.”

Based on the survey’s findings, financial advisors should be making an effort to check in with their female clients and all clients to see if they’ve faced any workplace-related or personal changes during the pandemic. If so, these clients may require help revising their financial plans to stay on track for retirement.

According to the TD Wealth study, the most common changes female clients made to their estate plans over the past year involved guardian and beneficiary designations (38%), powers of attorney (38%), a current will (35%) and post-mortem letters (17%).

“They’re feeling their mortality a lot more,” says White.

Biggest Threats Shift

Looking more broadly, the survey also identified a shift in the biggest threats to estate planning in 2021. Topping the list now is increased healthcare costs and prolonged life expectancy. Nearly a quarter (22%) of the estate planning professionals who responded to the survey cited this as a concern, compared with just 7% in 2019.

In addition, 21% see political conflict as a big concern this year (up nearly 11% from 2020) and 22% pointed to market volatility as a concern (up nearly 13% from 2020). A quarter of respondents (25%) suggest planning to minimize future tax gain consequences. The Biden administration has proposed plans that could result in higher taxes on estates.

Meanwhile, family conflict, which was viewed as the leading threat for estate planning over the past three years of this survey, fell to 10% in 2021 from 20% in 2020.

“Due to a variety of reasons, priorities shifted, divorce rates skyrocketed and tough family decisions had to be faced, rather than avoided this year,” White said in a press release. She expanded on this point with Rethinking65: “People want to be able to live their life and be happy. When you realize that life could be over in an instant tomorrow, I think that’s a big factor.”

“Like my grandmother said, ‘Either you’ve got to fish or cut bait.'”

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