Three Legs of the Stool

A financial plan is similar to a three-legged barstool, with the three legs of the financial barstool being represented by (1) a financial advisor, (2) an accountant, and (3) an estate planning attorney.  Without all three legs in place, the barstool (your financial plan) becomes shaky, and if two of the three legs are missing, you’re in serious risk of collapse.  

Financial advisors are often on the front lines with their clients urging them to put an estate plan in place.  The financial advisor’s role in the estate planning process is significant and often understated—indeed, the soundness of a financial plan often coincides not only with investments, but also the transition of wealth from one generation to the next. The financial advisor also plays a key role in ensuring that estate plans are continually updated as financial situations and family dynamics change.

Accountants serve as the glue that keeps your estate plan and financial plan connected. Aside from ensuring compliance with federal and state tax laws, your accountant serves as the repository for much of your financial information, and also ensures that assets are properly reported on tax returns. In Texas, which is a community property state, your accountant can also play a major role in maintaining records of your community and separate property assets.

The estate planning attorney’s role is to prepare and help implement a plan for the transition of your wealth to future generations. For some, this may include strategies that utilize the federal estate tax marital deduction, lifetime gift and estate tax exemption, generation-skipping transfer tax exemption, or annual gift exclusion to minimize or postpone the payment of federal estate and gift taxes. For others, this may include fulfilling charitable giving desires. In any event, estate planning attorneys work with both financial advisors and accountants to ensure proper reporting and titling of assets.

One benefit of my practice is that I have had the opportunity to meet some of the best financial advisors and accountants in the Dallas-Fort Worth Metroplex.  Please feel free to contact me if you’d like me to help setup meetings with financial advisors or accountants to ensure that your financial barstool is on solid ground.