CHERRY HILL, N.J. and NEW YORK, April 21, 2022 – According to TD Wealth’s fourth annual estate planning survey, digital tools and assets could be adding another level of complexity to the planning process.
This year's survey found that more than two-thirds (69%) of estate and financial planners are now incorporating digital tools into their clients' estate plans.
The digital content that led the way into estate plans in 2022 included blogs, social media and email accounts (71%), followed by passwords at 67%. The increase in the use of digital content and tools is consistent with an increased interest in digital assets like Bitcoin and other cryptocurrencies (61%).
“In this current market environment, we’re seeing a distinct shift to increased digitization, whether that’s planning for social media accounts, interest in cryptocurrency, or simply exploring digital wealth planning tools," says Donna Walton, Vice President, Wealth Strategist at TD Wealth. "People want their financial planning to advance alongside their day-to-day use of technology and digital integration.”
The results also revealed that more than eighty percent (83%) of surveyed estate and financial planners said they use digital tools to support clients’ estate planning, leveraging estate planning software (52%) and online wealth and/or estate planning platforms (48%), demonstrating that a majority of estate planning professionals are going digital to efficiently support their clients' needs.
Designation of Beneficiaries Emerges as the Leading Cause of Family Conflict
As family dynamics become increasingly complicated year-over-year, 34% of respondents cited the designation of beneficiaries as the leading cause of family conflict in 2022, up from 17% in 2021 and 14% in 2020.
To help mitigate family conflicts, 84% of estate planners have encouraged clients to discuss their estate plans with their families and beneficiaries over the past 12 months. Resulting from these conversations, only 15% of respondents reported that their clients directly raised the importance of bringing their family members and beneficiaries into the estate planning meetings, encouraging estate planners to help initiate including their clients' families and beneficiaries in those conversations, rather than the clients themselves.
"Communication is critical in helping to reduce conflict among clients and their beneficiaries," say Walton. "The need to openly discuss the plan and its execution allows for better preparation and outcomes, while providing an opportunity to address any potential emotional or logistical concerns."
Estate Planners Continue to Face Planning Challenges
As individuals and families contend with lingering financial losses ushered in by the COVID-19 pandemic, market volatility emerged as the number one threat to estate planning in 2022 (31%), up slightly from 22% in 2021 and 13% in 2020.
Document management is also becoming increasingly complex for clients and their independent legal counsel, with the following being most difficult to upkeep: powers of attorney (31%), current wills (29%, up from 11% in 2021 and 31% in 2020) and guardian and beneficiary designations (20%, down slightly from 33% in 2021).
“In this current economic environment, people are wary that market risks may upend existing plans. Many believe that inflation could devalue assets or business and employment challenges could threaten expected income and reduce the size of the estate left to loved ones," remarked Walton. “In addition, there continue to be increased challenges in arranging documents for clients. Clients and estate planners need to plan for the unexpected, such as law changes or family dynamics, to manage increased complexity when it comes to estate planning.”
Survey Methodology
TD Wealth commissioned Maru/Matchbox to conduct a survey targeting certified estate planners, estate planning attorneys, trust officers, charitable giving professionals, insurance advisors, elder law specialists, wealth management professionals and non-profit advisors with objective of finding the latest trends impacting estate planning professionals. A total of 142 responses were collected. The survey was fielded in April 2022 and all samples are sourced through the Maru/Blue proprietary panel and partners.
About TD Wealth
Through TD Bank N.A. (TD Bank),TD Wealth's Private Client Group and its affiliates (TD Wealth) 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, a registered investment adviser and broker-dealer and 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 does not provide tax, legal or accounting advice. You must consult with your own tax, legal and accounting advisors for specific advice pertaining to your estate planning needs.
About MARU/Matchbox
Maru is a world leading CX and Insights Software & Advisory Services company. Maru was founded to disrupt the data and insight delivery industry with a combination of Software & Advisory Services delivering data in real-time via a unique service model. Maru helps its clients make informed decisions in near real-time by combining proprietorial software, deep industry experience and access to the best minds in research. Maru's flexible service model means our clients can choose to self-serve our Software directly to create, launch and analyze projects; or choose to utilize our Software with knowledgeable support from insights experts. Maru successfully delivers major national and international CX and CEM programs for Enterprise organizations.
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PJ Brovak
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Paul.Brovak@td.com