Wanted: skilled planners only

Skills deficit in estate planning

By Madeleine Collins
Wed 16 May 2007

Planners need to brush up on their skills in estate planning, a legal specialist has warned.

Longer life spans and later retirement ages mean planners need to brush up on their skills in estate planning, a legal specialist has warned.

Advisers need to become lead managers offering sophisticated estate planning strategies, Cutler Hughes & Harris special counsel Michael Perkins told a Dealers' Group conference in Sydney yesterday.

"Many baby boomers will be retiring not having received their inheritance and still looking after their parents whose wealth may be decimated by rising future costs," Perkins said in a paper circulated to delegates.

Perkins said the demise of death duties in the 1970s has led to a substantial decline in estate management in the legal, tax, accounting and financial service professions

"The books of professional indemnity insurers are littered by many examples of insufficiently skilled advisers getting involved in this area of work and [it] going...badly or wrong."

Advisers need to move to a more collaborative approach with lawyers and accountants because clients expect a more sophisticated service that simply a referral, he said.

"We have to get away from the idea of serial referrals," Perkins said.

He said there was a skills deficit problem in estate planning services.

"Generally you need at least two people doing the job . . . You've got to be terribly wary about the competency of other advisers."

Advisers also need to be aware of the tax implications for beneficiaries, for example, non-dependents that get hit with a 15 per cent tax bill from their parents' super.

"We've got to be sensitive to how these structures relate to the long-term position of families," Perkins said.

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