“Never would I have imagined being a widow at the age of 49, but it happened. And it became very real very quickly.”
Jenni Scott Simms, a Regions Consumer Support and Delivery associate, lost her husband in September 2020 after his brave 19-month battle with Pancreatic cancer. They had only been married for 6 years, a blended family with dreams and plans as they got older.
“We both had talked initially about wills, and other things, but as in most marriages, we thought we would have time to get things ready before we got older,” shared Simms.
Some conversations are more difficult than others.
In 1789, Benjamin Franklin famously declared that nothing is certain except death and taxes. Yet, it is one of those topics that many of us put off having with our loved ones.
We sat down with Heather Davis, senior trust advisor at Regions Private Wealth Management, who has facilitated these conversations with her clients for more than two decades.
From the Baby Boomer generation to Generation X and Millennials, who are quickly settling into their respective roles as a sandwich generation navigating life with both young children and aging parents, there are planning needs that shouldn’t be overlooked.
Legacy Planning: Are You Up to Date?
“Many clients either don’t have an estate plan, or they created one years ago and need to update it in accordance with their current situation,” Davis shared. “We focus on mitigating estate tax liability, but the everyday conversations we are having about legacy planning often involve brainstorming with clients and educating them on how an estate plan will work.”
Davis – and other Regions Private Wealth Management advisors – often facilitate discussions around the ‘what if’ scenarios when they meet with clients to discuss estate planning. Whether it is an older client who has an outdated estate plan or a young couple planning for their future family, it is important to recognize the various goals and objectives that an estate plan can address.
In a recent podcast, Financial Planning For Women: How to Be Present, Proactive and Prepared for the Unexpected, Davis joins Jama DeHeer, senior wealth planner at Regions, to share their respective insights around what women can do to ensure they’re participating in financial decisions. In this podcast, they address the importance of financial and estate planning at any age or stage in life, and stress that the sooner a plan is in place, the easier it is to face any unexpected challenges that may arise.
The Generational Divide
The sandwich generation, those with at least one living parent over the age of 65 and raising children under the age of 18 or supporting a grown child, potentially encounter the added financial stress of also supporting an elderly parent.
“With people living longer, we have many sandwich generation clients talking with our team because their aging parents have not put together an estate plan,” noted Davis. “Those conversations shift to the adult children handling the finances to support an elderly parent, understanding elder law, estate planning and planning for physical and medical care.”
Davis shared that the adult children may have amassed their own wealth, but the parents may not. In these scenarios, the adult children find they are paying the difference for the parent’s long-term care because the aging parent doesn’t have the wherewithal to cover it. An important question to ask yourself centers around whether your parents have or need long-term care insurance.
“Long-term care insurance can become cost prohibitive as you age,” said Davis. “These are important conversations to have going into estate planning because even if the aging parent has a long-term care policy, they need to know the extent of their coverage. For example, what does it cover, what doesn’t it cover, and what is the daily or monthly coverage?”
It is often an aging parent’s medical or long-term care need that sends a client into their financial advisor’s office to start a conversation around their needs as they look at their own financial future.
Navigating Unexpected Loss
“What became a sharp reality is not only was I losing a husband, but I was losing a financial advisor,” said Simms. “He had managed our own finances. A tax accountant. He had always prepared our taxes. And so many other partner aspects.”
This is a common scenario for financial advisors working in estate planning when a widow loses their spouse and, amidst the emotional turmoil, is feeling lost in not knowing what to do next when it comes to the financial shifts and their own financial future.
“It can be paralyzing to lose a loved one, especially for the elderly, who like many of us believe they have more time to prepare,” said Davis. “It is comforting to have a trusted advisor who understands their family dynamics, estate planning goals, and can provide names of attorneys. Upon request, we will even attend meetings with them as they navigate the path forward.”
A holistic financial advisor who specializes in estate planning can help clients by understanding their complete financial picture while also providing a shoulder to lean on.
“It is a delicate conversation and never an easy one,” said Davis. “I’ve been doing this for more than 20 years and I still cry with spouses and family members when they lose their loved ones. It is a very real part of life. I’ve lost someone, too – a client and friend. When someone is caught by surprise, it can be very difficult to find the right words to comfort them.”
A premature or unexpected loss can be devastating at any age – and, as Davis points out that by today’s longevity standards, losing someone at age 70 can be unexpected these days. When there is a long-term illness involved planning can be done over time allowing the parties to get an in-depth understanding of the financial sources, assets and future needs, though it is no less emotional.
“If we know about a terminal or impending illness, we want to put that estate plan in place immediately,” said Davis. “Much will depend on their mental capacity and the client’s net worth. If they are very wealthy and haven’t done enough planning, that can be devastating for those facing large estate taxes above the exemption level. It’s crucial to have those difficult conversations and mitigate the financial impact.”
Legacy Planning: Starting the Conversations
“If there is one thing I could encourage parents, wives, husbands, brothers, sisters to do now: have open conversations with each other, with your kids, and other important people in their lives,” shared Simms. “Find that financial advisor that can guide you in those conversations. Talk about decisions and truly spend time learning about what the other thinks when it comes to their own end of life. Choose to talk about what each of you wants when the other is gone.”
There are many considerations in legacy planning, including whether or not there are heirs and if there is a plan for that inevitable transfer of wealth. Family business ownership is another important consideration – is there a succession plan in place for that business?
Few of us are very comfortable talking about the certainty of death – our own or that of our loved ones – but the repercussions of not having those conversations can range from minor to major, depending on your financial health. Having a roadmap to help navigate that difficult path can make a challenging phase of life a little less burdensome for our loved ones.
“Grief is a very long journey that requires patience for those navigating the loss of a spouse,” shared Simms. “It requires support from others on this long journey.”
Below are some additional resources around legacy planning and managing the financial future in the wake of loss.
If there is one thing I could encourage parents, wives, husbands, brothers, sisters to do now: have open conversations with each other.
Jenni Scott Simms, a Regions Consumer Support and Delivery associate
Additional Resources Around Legacy Planning
This information is general in nature and is not intended to be legal, tax, or financial advice. Consult an appropriate professional concerning your specific situation and irs.gov for current tax rules.