Largest Estate Issues Facing DB and/or DC Plan Participants/Owners?

[Guest Ryder]

I am a DC/DB business analyst, and have several clients who are clamoring for estate help, as their sales representatives are not offering much help in this arena. What would you say are the biggest estate challenges and issues with owners of and participants in db/dc plans?Thanks!

[Bruce Steiner]

Estate planning for retirement benefits can be quite complicated, and your clients should be getting their legal advice from competent counsel, not "sales representatives."

I think that among the biggest challenges and issues are Roth conversions for large retirement benefits, and what to do when the client does not have sufficient nonretirement assets to fully fund the credit shelter trust.

[Guest Ryder]

I agree with you about sales reps. The quickest way for me to lose a case is via the Plan's sales rep.

I am a dc/db pensions analyst/consultant/manager, and I obviously understand the ramifications of the strategic naming of beneficiaries, as well as carefully-crafted plan documents as they relate to estate planning (i.e., some documents don't allow for stretch IRA's, etc.).

I realize that this should ideally be the realm of accountants and tax lawyers -- however, it's extremely important for the pensions consultant to have this knowledge in her toolbox as well.

I know that neither my CEBS nor my ASPA desig's have imbued me w/ the info I believe I need to adequately service my clients in the areas of estate planning; however, their accountants seem to know less than me. I imagine that I will study and get extra estate planning designations, whatever those may be, so that I can competently enter this arena.

Even w/ the new Congressional stuff going on, I feel estate tax minimization will continue to be a big deal for most

of the individuals I deal with.

Anyway, is there anyone out there who can point me to the best educational resources for "estate planning certification," if such a thing exsits (of course, besides going back to school for another 8 years to become a lawyer)?

[Bruce Steiner]

With all due respect to the accountants, they're not necessarily tax/estates lawyers, so it's quite possible you know more about tax/estates law than many accountants.

Law school is 3 years full-time, or 4 years part-time. Then you should get an LL.M. in tax, which takes 1 year full-time, or 3 years part-time. Then you'll have to work for someone for a while. So it probably will take you more than 8 years to become proficient in tax/estates law. If it's any consolation, it would take at least as long to become proficient in certain medical specialties.

[GBurns]

While it is nice to tout the merits of a law degree it does point out that you learn a lot about the law. The original question had more to do with planning. I have not seen planning as an item in a law school curriculum.

Clients need some one competent in planning strategies and concepts. These should then be referred to a competent lawyer for the implementation and legal structure and documentation.

The client needs more than one competent advisor, each skilled in their respective areas.

A lawyer most likely is not a planner or concept creator. Egos should not be a factor.

[Bruce Steiner]

Drafting is often the easier part of the lawyer's job.

The harder part of the lawyer's job is often the decision making process -- applying the law to a specific set of facts, making the legal judgments and making recommendations to the client.

Indeed, for a number of reasons, estate planning tends to be a particularly difficult area of law.

This does not in any way take anything away from the role of other advisors, be they actuaries, accountants, investment advisors, insurance advisors, bank trust officers, or others. The client's other advisors can be helpful in the estate planning process. Often one or more of the client's other advisors are the catalysts in getting the client to deal with his/her estate planning. But ultimately the client has to sit down with his/her lawyer and develop (and periodically update) his/her estate plan.

The curriculum in law school is geared more to analyzing cases than to the practical aspects. That's why I said that if Ryder wanted to become knowledgeable in tax/estates, after going to law school and getting an LL.M. in tax law, he/she should work for someone (most likely in the tax/estates department of a law firm) for a while.