Client outcomes

Igniting legacy planning action

August 16, 2022

Financial professionals understand the value of estate planning, but starting that conversation and inspiring clients to take action can be challenging. A 2021 Gallup poll showed that 64% of American adults working with a financial advisor have never discussed their estate plans with that advisor.

This could be for many reasons, but the most common roadblocks are the perception that estate planning is complex and that families find it uncomfortable to talk about. It’s easy to think of estate planning as just wills, trusts and advanced directives, but it’s so much more. There are other tactics and techniques that can make a big difference in helping your clients meet their legacy planning objectives, so it’s worth the effort to start the conversation.

Before we tackle some of these estate planning concepts, let’s identify ways that a financial professional can engage with their clients on the subject.

The importance of an estate plan

Educating your clients on why they need an estate plan is a crucial step in helping them realize the importance of having a legacy planning discussion. This discussion is simply the process of creating a plan for the distribution of assets at death. This plan can encompass:

  • Limiting income and estate tax liabilities
  • Determining who receives the assets — and when and how they’re received
  • Facilitating timely payment of estate obligations and taxes
  • Limiting costs of administration

Estate planning should be considered by anyone who owns property; it’s not just for the wealthy or those with complex situations. Clients should understand the consequences of failing to plan. If an individual passes away without a will, the State will use intestacy laws to determine the distribution of property. Unfortunately, this frequently doesn’t align with the individual’s intent. A proper plan helps provide a level of certainty to the estate owner and safeguards his or her assets for the benefit of their heirs.

Beginning the process

Prior to recommending and implementing strategies for your clients, it’s important to lay out these three steps to develop an effective plan:

  1. Identify estate transfer needs and goals. – In this step, the clients should get an idea of where they are (their starting point) and where they want to go. The biggest considerations here are identifying beneficiaries, clearly understanding tax obligations, looking at estate assets, and knowing where to find liquidity in the estate. It’s also important in this step to inquire about the client’s future income, expenses, debts and needs.
  2. Develop strategies to reduce costs.Taxes are the largest potential expense a client’s estate may have. These can include the federal gift tax, federal estate tax, generation-skipping transfer tax, state death and inheritance taxes, federal income taxes, and estate administration expenses. Financial professionals should be aware of the applicable exclusions, deductions and transfers that clients can utilize to help minimize this burden.
  3. Pay for remaining expenses. This is where having the proper liquidity to pay estate expenses helps ensure your client’s beneficiaries receive what your client intends. Liquidity is the estate’s ability to pay taxes and other costs that arise after death (usually in the form of cash or cash alternatives). If a client’s portfolio consists largely of real estate or business interests, the estate may be forced to sell a portion to pay for expenses when they are due. Knowing this, estate liquidity should be a primary objective for clients and their financial professional. Having the right tools to meet the liquidity need is crucial. Annuities and life insurance with the right strategy behind them can accomplish this goal.

Advanced strategies and solutions to consider

Life insurance

Several popular concepts aim to help clients meet their estate planning and wealth transfer needs by utilizing life insurance and trusts. Some to consider include:

  • Irrevocable life insurance trust (ILIT)
  • Spousal lifetime access trust (SLAT)
  • Credit shelter/bypass trust
  • Grantor retained annuity trust (GRAT)
  • Estate equalization
  • Charitable remainder trust with wealth replacement life insurance

The Advanced Life Marketing Concepts Guide from the Advanced Consulting Group (ACG) can help break down and simplify these concepts.


Annuity concepts are often used to help pass assets on to spousal and nonspouse beneficiaries. Financial professionals can consider:

  • Legacy planning with an IRA deferred annuity
  • Death benefit and spousal protection using a Roth conversion
  • In-kind distribution of a trust-owned annuity for retirement protection for a trust beneficiary
  • Nonqualified annuity stretch for multigenerational wealth transfer
  • Charitable remainder trusts (CRT)

The ACG’s Advanced Annuity Marketing Concept Guide is where you can learn more about these and other strategies that can benefit clients’ wealth transfer plans.

Helpful tools

Nationwide’s estate planning fact finder can assist you and your clients with legacy planning. It helps you gather relevant information and identify tools and solutions you can put in place for them. I invite you to use this with clients today to help kick off an estate planning conversation.


  • Federal income tax laws are complex and subject to change. The information is based on current interpretations of the law and is not guaranteed. Nationwide and its representatives do not give legal or tax advice. Please consult an attorney or tax advisor for answers to legal questions.