CHERRY HILL, N.J. and NEW YORK, NY, May 20, 2021 – TD Wealth today released results from its annual survey of estate planning professionals revealing that 89 percent of respondents cited that their female clients were negatively impacted in the past year by job losses, leaving the workforce or decreased salary, due to the COVID-19 pandemic.
As a result, 87 percent of respondents that included certified estate planners, estate planning attorneys and trust officers, made changes to their female clients’ estate plans to reflect their new financial situation. Such changes included guardian and beneficiary designations (38%), powers of attorney (38%), current will (35%) and post-mortem letters (17%).
“It’s no surprise that women’s estate plans were dramatically impacted by the pandemic, as women overall have been disproportionately impacted through what we’re seeing as a ‘she-cession’, particularly regarding their careers," says Kalimah White, Vice President and Wealth Strategist at TD Wealth. "Women are also more likely to live longer than men, thus driving home the importance of having up-to-date estate plans, while making plans that consider not only their longevity, but their family’s future.”
Family Conflict No Longer Greatest Threat to Estate Planning
As individuals, families and caregivers make long-term planning decisions to account for living longer and extensive healthcare options, the increase in healthcare costs and prolonged life expectancy moved to the forefront of concerns in estate planning. Nearly a quarter (22%) of respondents named this as the biggest threat to estate planning in 2021, more than tripling from 2019 (7%). Additional threats also top-of-mind for planners included political conflict (21%, up nearly 11% from 2020) and market volatility (22%, up nearly 13% from 2020). Family conflict, the leading threat for estate planning according to the same survey over the past three years, fell by more than half in 2020 – from 25 percent in 2020 to 10 percent in 2021.
In previous years, not communicating estate plans with family members was the most common cause of family conflict (43% in 2020). In 2021, this dropped by nearly half to 24 percent, as dealing with blended families became the most common cause of family conflict (34%). Other common causes of family conflict include the designation of beneficiaries in retirement accounts (17%), a client's resistance to creating an estate plan (17%) and naming the guardian of a minor in a will (8%).
“Due to a variety of reasons, priorities shifted, divorce rates skyrocketed, and tough family decisions had to be faced, rather than avoided this year. Like many other trends, the pandemic accelerated the need for a long-term estate and financial plan in the event of uncertainty,” says White. “The pandemic added another layer of complexity to estate planning and clients saw firsthand the immediacy and importance of planning for the unpredictable and reviewing estate plans on an ongoing basis.”
Tax Reform Under a New Administration Is Top of Mind for Estate Planners
This new year has seen an influx of legislation with transition to a new administration. As estate planners reconsider how to alleviate the implications of future tax policies for clients, a quarter (25%) of respondents suggest planning to minimize future capital gains tax consequences, as well as charitable giving planning to reduce the size of estate and lower income tax liabilities (23%) as priorities.
“Under a new administration, estate planners are concerned with how new tax policies will impact estate and financial planning, which means income tax saving strategies will be increasingly important and a persistent trend across the industry," adds White. "And while everyone's situation is unique, it is always best to consult with financial professionals to determine which available options could alleviate stress and uncertainty when planning for one's financial future.”
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.
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 2021 and all samples are sourced through the Maru/Blue proprietary panel and partners.
About TD Bank Group
The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group ("TD" or the "Bank"). TD is the fifth largest bank in North America by assets and serves over 26 million customers in three key businesses operating in a number of locations in financial centres around the globe: Canadian Retail, including TD Canada Trust, TD Auto Finance Canada, TD Wealth (Canada), TD Direct Investing, and TD Insurance; U.S. Retail, including TD Bank, America's Most Convenient Bank®, TD Auto Finance U.S., TD Wealth (U.S.), and an investment in The Charles Schwab Corporation; and Wholesale Banking, including TD Securities. TD also ranks among the world's leading online financial services firms, with more than 14 million active online and mobile customers. TD had CDN$1.7 trillion in assets on January 31, 2021. The Toronto-Dominion Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.
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.