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Mix Persistence With Charm to Get Clients Moving

March 6, 2015

This week FA-IQ interviewed Dale Horn, senior vice president of wealth management at UBS Wealth Management in Baltimore. Horn recalls how he helped a client work through a thorny inheritance issue she would have preferred to avoid.

I specialize in working with widows. A few years ago, I was recommended to a woman in Florida whose husband had recently passed away. In one of our first meetings, I learned she and her husband had a beloved vacation house in Nantucket where they had spent several months each summer. But whenever I started to inquire about how the family planned to manage the house after she passed, she would clam up. It was clearly a subject she did not want to talk about.

At first, I deferred to the client’s wishes. Her husband had just passed, so of course she was sensitive about talking about anything that touched on her own mortality. But as the months went by, I started to become increasingly nervous about her avoidance of the question.

In part, that was because I had gotten a better sense of several other issues surrounding the Nantucket house. The client had three adult children, none of whom was in a position to cover the upkeep and taxes on the house. Furthermore, the three children didn’t really get along with one another. But every time I tried to talk about it, my client would redirect.

I could have just written a comment in my notes — “Brought up vacation home with client; did not want to discuss” — and moved on. Technically, she didn’t have to do anything. She could put the situation out of her mind and let her children work things out after she was gone. But I’ve seen enough horror stories that I didn’t feel comfortable doing that. In my experience, families that don’t make provisions for vacation homes risk running into serious problems. I’ve seen situations where siblings stop speaking with one another or even get embroiled in litigation. So I felt an obligation to force the issue, even though my client kept resisting and even though her children were not my clients.

At this point, she and I were speaking on the phone about every two weeks. Basically, I tried to be persistent, even though it was not easy. I’d bring the issue up, she’d redirect, and I’d try to steer the conversation back. I had to find that line between gentleness and persistence. My motto was: Be insistent, with charm. I kept telling her that avoiding the problem was just going to make it worse. I’d ask her to visualize the further rifts it might cause among her children, who would be dealing with a house they couldn’t afford. After I pestered her more than 20 times, she finally agreed to let me work with her lawyer.

In the end, we came up with a plan that will hopefully address many of the underlying issues. We created a fund to pay for the property’s maintenance and an ownership-rights document with a buyout provision. Through the process, I got to know all three of my client’s children. Their relationship is still strained, but they’ve each individually communicated to me their gratitude that we worked out a system now rather than waiting until their mother passed and they were forced to come up with something on their own.

The situation was so difficult at first and ended up working out so well that I now use it as a kind of template when I’m dealing with other clients who have family vacation homes. I even encourage clients to think about titling and inheritance issues when they buy a second home. Over time, it’s become clear to me that our responsibility as advisors doesn’t end with our clients. We have to help them determine how these assets will be passed on to the next generation, too.