I had the second of four meetings with Ron L. yesterday in his office in Sun City. I brought with me a list of 10 Estate Planning Industry Issues that I wanted to get Ron’s feed back on. I was hoping to elicit his opinion and experiences on each of these issues to look for ways that I may be able to complement his practice.
Number 2 on my list was “Wealthy clients are often disorganized and have difficulty completing the fact finder that lists their assets and titling.” Even though Ron does not use a hard copy “fact finder”, he does spend the time in his initial meeting asking the client questions to fill in this important information. Number 4 on my list was “Unproductive time spent selling prospects who don’t become clients”. Ron mentioned that sometimes he runs into problems with clients where he does not have enough time in the initial meeting to get through all of the assets and the client has some resistance in paying for additional time. He also has a program where he offers a “document review” at $150/hour which is much lower than his $350/hour normal rate. Sometimes he struggles with clients who want him to review their trust at $150 for an hour, when it will take much longer to review and offer guidance.
I asked him if it would be helpful to have a summary of all the assets along with the main issues they want to discuss, before they came in to see him. Ron exclaimed that this summary would be very helpful and that maybe he would even offer a discount to clients that I bring him with this leg work already done.
Issue number 3 on the list is “no recurring revenue”. I asked him if he has any program in place to reach out to past clients. He has often thought about doing something but has never put a formal program in place. He does encourage his clients to check in every 5 years or whenever they have a major life event. In my mind I am envisioning working on a list of his best past clients and starting a review program where they can come in for a “check up” for a set fee, and as part of the check up, I can perform a scenario analysis or gather the relevant asset information before they come in to see him. I will need to give this more thought.
Number 7 was “Challenge recommending advanced planning options without a strategic alliance to provide required financial analysis and products”. I asked him to show me how he presents an Irrevocable Life Insurance Trust to his clients. He uses a note pad to sketch out some of the details along with a copy of an old article that explains how the name “Crummey” trust came into existence. Ron told me that he does not have any software that can sketch out What If? Analysis. I definitely think it would be helpful for Ron and his clients if I can present our proprietary Interactive Financial Plan and show them with nice color graphs how much money they can preserve in their estate with a well crafted Insurance Trust.
Our meeting was cut a little short, because his next appointment showed up a little early. I did not get to ask him how or if he does any due diligence on the insurance policies that get put in place. The next seminar for the Central Arizona Estate Planning Council in March is addressing this very subject, so this may be something else we can discuss.
I will contact Steve Moeller with the following questions:
1. Do I show the Common Client Issues sheet to Ron during the meeting or is that something I am supposed to keep in my mind while I ask him the questions from the Estate Planning Issues sheet?
2. I would like to exampleas and/or language to refer to when crafting the right questions to ask in this 2nd meeting.
Plus I am realizing that this process will take 3 months minimum to implement with each attorney. I need to make a push to start the process with some other attorneys now if I want to have 4 good alliances established by the end of the year.
Monday, February 15, 2010
Friday, February 5, 2010
Strategic Alliance Meeting with John L.
This is my second go around with an initial strategic alliance meeting. This time it is with John L. at RCA law firm. This happens to be the same law firm that my wife works at so it was a pretty easy meeting to set.
John has some history with one of my larger clients and according to my Dad, had suggested they do something different with their trust management then what my Dad had suggested. That was enough for my Dad to write him off. I had also heard from our Trust specialist that he had a good relationship with one of the advisors in our Sun City office. With the past experience in the back of my mind, I did not have as high of expectations for this meeting as I did with Ron L. last time.
We met for breakfast at Paradise Bakery. John was really friendly and we got a little side tracked at first talking about RCA law firm and the direction they are heading. My wife has been real concerned about the bad economy's effect on the future profitability or RCA law firm and John was picking my brain for information on my point of view.
Eventually we moved the conversation to investigating the possibility of a strategic alliance. First of all, I have to hand it to Steve Moeller, his ideas on sending out the confirmation letter and giving the attorney the list of questions really sets the tone. Both of the lawyers I have me with seemed very eager to impress me and try to find a way to do business. I have not felt at all like I was the one under pressure to sell my firm.
John L. is 66 years old. He started his career at RCA in 1970, but he left after 25 years to form a boutique firm in Sun City and Scottsdale. His boutique firm had 2 other younger partners and when the lease was coming up for renewal, he did not feel comfortable signing another long term lease with his partners. He was bringing in most of the business and if something would happen to him, he did not want to be tied in to them for a long stretch of time. So he made some calls and RCA had just lost their top producing estate planning attorney and he found he could slide right back in. In addition, RCA has a Denver office, and John L. has home in Colorado and does some work there as well so it was a nice fit.
RCA has 3 other attorneys in the Estate Planning practice. John uses one paralegal as well. John spends his office hours in Sun City, Scottsdale, and Denver. The majority of his clients have net worths of $2-$5 Million with some outliers in the hundreds of millions. He said he does not have a specific client niche like doctors or business owners, his clients come from all walks of life.
He does not have a formal plan for acquiring new clients. 70% of his business is referrals or repeat business from his current clients. The rest comes from referrals from other professionals. He does not do a lot of insurance business. Not because he doesn’t believe in it, but he says some of the referrals he gets from insurance professionals are not doing what is right for the client.
He has done a lot of work with charitable planning and trusts. He was a director for the Arizona Community Foundation from 1988-2000. ACF has an alliance with Merrill Lynch and I have a couple of clients that have charitable trusts with them already.
He did not have a clear answer on his ideal client profile. He said he seems to receive a lot of clients that are on their 2nd or 3rd marriage and he has to fix or undo an ineffective estate plan. He also has done quite a bit of work on large retirement accounts and cleaning up beneficiary designations.
I asked him about his initial meeting with clients. He said he does not use a formal questionnaire, but he does ask them a lot of questions and writes down what he needs. The initial meeting is free if the client decides to go somewhere else. If they decide to use John, then the cost of the first meeting is rolled into the total cost. After he writes an initial draft, he makes sure to go over the paperwork with the client face to face. He does not believe in sending out the documents to the client to read since that just causes panic and strife.
I asked him to give me what his frustrations are with his practice. Again he did not have a clear answer and basically said that everything is great.
In review, I did not uncover any glaring problems in his practice that I can immediately help him with. My gut was telling me that he will not end up being one of my strategic alliance partners. He is a very well qualified attorney with tons of experience and lots of high net worth clients. I would trust him to work on my client’s estate plan, but I don’t know if I trust him to make my client feel good about the whole process by being friendly and extremely service oriented.
John has some history with one of my larger clients and according to my Dad, had suggested they do something different with their trust management then what my Dad had suggested. That was enough for my Dad to write him off. I had also heard from our Trust specialist that he had a good relationship with one of the advisors in our Sun City office. With the past experience in the back of my mind, I did not have as high of expectations for this meeting as I did with Ron L. last time.
We met for breakfast at Paradise Bakery. John was really friendly and we got a little side tracked at first talking about RCA law firm and the direction they are heading. My wife has been real concerned about the bad economy's effect on the future profitability or RCA law firm and John was picking my brain for information on my point of view.
Eventually we moved the conversation to investigating the possibility of a strategic alliance. First of all, I have to hand it to Steve Moeller, his ideas on sending out the confirmation letter and giving the attorney the list of questions really sets the tone. Both of the lawyers I have me with seemed very eager to impress me and try to find a way to do business. I have not felt at all like I was the one under pressure to sell my firm.
John L. is 66 years old. He started his career at RCA in 1970, but he left after 25 years to form a boutique firm in Sun City and Scottsdale. His boutique firm had 2 other younger partners and when the lease was coming up for renewal, he did not feel comfortable signing another long term lease with his partners. He was bringing in most of the business and if something would happen to him, he did not want to be tied in to them for a long stretch of time. So he made some calls and RCA had just lost their top producing estate planning attorney and he found he could slide right back in. In addition, RCA has a Denver office, and John L. has home in Colorado and does some work there as well so it was a nice fit.
RCA has 3 other attorneys in the Estate Planning practice. John uses one paralegal as well. John spends his office hours in Sun City, Scottsdale, and Denver. The majority of his clients have net worths of $2-$5 Million with some outliers in the hundreds of millions. He said he does not have a specific client niche like doctors or business owners, his clients come from all walks of life.
He does not have a formal plan for acquiring new clients. 70% of his business is referrals or repeat business from his current clients. The rest comes from referrals from other professionals. He does not do a lot of insurance business. Not because he doesn’t believe in it, but he says some of the referrals he gets from insurance professionals are not doing what is right for the client.
He has done a lot of work with charitable planning and trusts. He was a director for the Arizona Community Foundation from 1988-2000. ACF has an alliance with Merrill Lynch and I have a couple of clients that have charitable trusts with them already.
He did not have a clear answer on his ideal client profile. He said he seems to receive a lot of clients that are on their 2nd or 3rd marriage and he has to fix or undo an ineffective estate plan. He also has done quite a bit of work on large retirement accounts and cleaning up beneficiary designations.
I asked him about his initial meeting with clients. He said he does not use a formal questionnaire, but he does ask them a lot of questions and writes down what he needs. The initial meeting is free if the client decides to go somewhere else. If they decide to use John, then the cost of the first meeting is rolled into the total cost. After he writes an initial draft, he makes sure to go over the paperwork with the client face to face. He does not believe in sending out the documents to the client to read since that just causes panic and strife.
I asked him to give me what his frustrations are with his practice. Again he did not have a clear answer and basically said that everything is great.
In review, I did not uncover any glaring problems in his practice that I can immediately help him with. My gut was telling me that he will not end up being one of my strategic alliance partners. He is a very well qualified attorney with tons of experience and lots of high net worth clients. I would trust him to work on my client’s estate plan, but I don’t know if I trust him to make my client feel good about the whole process by being friendly and extremely service oriented.
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