The Fact Finding Phase
At Dana Whiting Law, “we believe that Estate Planning is a process, not a document”, said Matt. “You are not paying for a stack of papers, you are paying for our experience, advice and guidance in making key decisions”. We have two ways we could proceed, depending on the client and the level of service the client wants.
In either case, the first step is to do a sufficient amount of fact gathering from the client. We will provide the client with a “Fact Finder” to complete and bring with them to the first meeting. We will also provide the client with a list of existing documents to bring in. Our relationship will begin with a thorough understanding of each other. Before we enter into an official legal engagement, we want to understand the needs and desires of the client, their financial picture, the structure and the make up of the family with specific discussion of each family member. We will also ask the client to bring in copies of any existing estate planning documents, Wills, Trusts, Powers of Attorney, etc. We never charge the client for this first “fact finding meeting”. “We don’t believe in charging the client a legal fee for them to come in and verify that we have the appropriate experience to help them create or modify their estate plan, and to make sure we understand their goals and objectives and ultimately to make sure that our personalities will work well together”, said Matt.
The Design Phase
If the client wants to proceed to the Design Phase, then we give the client a choice of two different options. The first option, “the simple design option”, we schedule one design meeting where we will illustrate two or three versions of a Trust, in flowchart form and review those flowcharts with the client. These flowcharts have been designed to fit the needs of most clients. Perhaps 80% of all of our clients would fit within these several options with some minor modifications. These flowcharts have been developed over 30 years of practicing estate planning, and have been successful in serving the clients needs and desires very well. This “simple design option” seems to work the best for clients who have a net worth of $5 million or less, the assets are relatively simple, and the family dynamics are relatively simple. At the end of this design session, we will present the client with a fee agreement that lists various flat fees for each of the designs that were illustrated.
The second option, “the custom design option” we recommend that the client participate in at least two design sessions (maybe 3 or 4 depending on the complexity of the client’s situation) instead of the one design session in the “simple design option” above. The number of design sessions is completely up to the client to decide. Under the “custom design option”, the client wants to see more options then the 2 or 3 designs in the “simple design option”. This client will perhaps have a net worth in excess of $5m, will have more complex tax issues, perhaps a large IRA or other tax deferred assets. This client will also have more complexities in the dynamics of the family. (ie children from a prior marriage, children of a current marriage, and step-children of existing spouse – maybe this client has a “special needs” child) This client may perhaps have a same sex marriage, or some other circumstance that may require more time and expertise in designing the estate plan. If the client chooses this option, we will agree on a flat fee for each design session, usually approximately $500. The client then has the prerogative to choose how many sessions they want. Each design session will last about an hour and a half. If after the client completes the design sessions, the client does not want to proceed to the next step of implementing the estate plan, they can terminate the engagement and simply pay for the number of design sessions that they had.
At each design session, the client is welcome to bring their CPA, Financial Advisor, or any other advisor or family member they choose. We will prepare custom flowcharts before each session, and present them at the session. These flowcharts will be specific to the client’s situation, goals and desires. In addition to the flowcharts, we will prepare excel spreadsheets and projections that will help the client understand the tax savings that can be achieved by embracing certain specific estate planning strategies. “We believe that a client should thoroughly understand an estate planning strategy and its benefits before the client embraces that strategy”, says Matt.
We will conclude these design sessions by providing the client and their advisors with a detailed “Estate Planning Proposal” summarizing each strategy that we discussed, the tax savings associated with each strategy, and the flat fees it would take to implement each Trust or strategy. The client can then review this memo with their CPA or other financial advisors. Once we agree on the design of the estate plan and the number of Trusts that we want to implement, the client will be asked to sign the “Estate Planning Proposal” which will also serve as the fee agreement for the flat fees described for each strategy. The client can choose to implement all of the strategies at once, resulting in a lower fee, or implement each strategy one at a time over a period of time. (Once again, estate planning is a process.)
The Implementation Phase
Using the flowcharts as the “blue prints” for the estate plan, we provide the client with a draft of the Will, Trust and other estate planning documents, usually within 7 to 10 days of completing the design session. The client will have another 7 to 10 days to review the documents before they come in and review the documents with us to make sure that the client thoroughly understands key provisions in the estate plan. We compare the provisions in the documents to the flowchart. After the client thoroughly understands the document and the flowcharts, a meeting to sign the documents will be scheduled.
The “execution of the documents” is also handled by an attorney, not a paralegal. The attorney answers any further questions the client has before signing. We provide the notary for the execution and the client is given the option to provide his or her own witnesses. (usually two are required) We will also provide the witnesses if the client desires.
The “Funding Phase”
After the documents have been executed, we are not finished until all assets have been properly retitled. We assist the client with the re-titling process to make sure that the Trusts that were created are properly “funded”. (a Trust only can control assets that it owns and it can only “own” assets that have been retitled) We sit down with the client, and review all of their assets and make a list of the assets that need to be retitled. We also list the assets that we are responsible for retitling and provide the client with a list of assets that they are responsible for retitling. We then provide the client with very specific “Funding Instructions” that walk them thru, step by step, in the process of changing the title of those assets. After the “Funding Phase” is complete, then we work with the client to complete “Schedule A to the Trust”, which is a list of all assets that were retitled. This Schedule A will be in the form of an excel spreadsheet that makes it easy, in the future, to update as the clients assets change and need to be titled into the Trust. Once again, we work out a flat fee with the client with respect to any assets that we are responsible for retitling. “One of the biggest mistakes in estate planning, is the failure of the attorney and the client to properly fund the Trust” says Matt. “We want to make sure that every Trust that we create is properly funded”.
Completion of the Estate Plan
In the end, every client has at least three meetings with an attorney. In the “simple design phase”, the design meeting may be part of the fact gathering meeting. Or, the review meeting may be combined with the execution meeting. Or, the funding meeting may be combined with the execution meeting. In the end, three meetings and depending on the client and their progress will depend on which meetings get combined. But, remember, all of this will be part of a predetermined flat fee.
In the “custom design option”, the client will have at least 5 meetings with us, maybe more. Once again, there will be at least two design meetings, and maybe 3. And, generally the review of the documents meeting is separate from the execution of the documents. But, the funding meeting may be combined with the execution. But, remember, all of this will be part of a predetermined flat fee. Once we agree on the flat fee, we will have as many meetings with the client as they choose.
Future Meetings after Completion
With every client, they are kept informed by us, free of charge, (usually thru email or a newsletter) of any future changes in the law. Clients will also be invited to frequent seminars and events to keep them informed and updated in changes in the law, free of charge. And, we also offer a free review of their Estate Plan with the client at least every three years. The client is advised on how changes in the law impact them specifically only if they schedule a meeting to come in and see us.
With the “Custom Design Option”, we encourage our clients to meet with us annually to make sure that the estate plan is properly funded, inform the client of changes in the law that specifically impact their estate plan and to see what circumstances may have changed in their lives. This annual meeting is charged at our normal hourly rates. We will review the estate plan and flowcharts with them and we will review their assets to make sure they are properly titled.
When signing the initial fee agreement, every client will be given the option for a “maintenance program”, where the client receives certain benefits each year, including a review meeting with their attorney, at a flat maintenance fee agreed upon in advance.
In either case, if the client wants to amend their estate plan, a flat fee will be quoted and agreed upon before any changes are made. (Once again, estate planning is a process.) “An estate plan is most efficient to eliminate probate, make administration simple and easy and save taxes when it is reviewed regularly"