For broker/dealer use only. Not for use with the...

For broker/dealer use only. Not for use with the public.

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1. It is critical for you to develop meaningful

relationships with your most valued clients’ families,

loved ones or heirs

2. Many tell you to connect with the next generation,

but few tell you how – we will tell you how and

provide you with valuable tools and resources

3. The family meeting is an ideal format for you to

facilitate effective dialogue and get to know those

closest to your clients

KEY TAKEAWAYS


• The “Great Transfer” will involve over $12 trillion in

assets shifting between the Greatest Generation to

the Baby Boomers1

• There is an even larger transfer estimated to occur between the

Baby Boomer generation and Generations X and Y1

• Connecting, engaging, planning and communicating

with your clients’ families or loved ones will be

essential to you retaining assets upon wealth

transfer

THE CHALLENGE

1. Accenture, “The ‘Greater’ Wealth Transfer, Capitalizing on the Intergenerational Shift in Wealth,” 2012.


• By building relationships with your clients’ families,

loved ones or heirs, you will increase the potential of

maintaining those assets, and may become the

trusted advisor for other family members.

• You may differentiate yourself by creating a strategy

to specifically connect with the most likely inheritors:

• Women (the spouses)

• Millennials (the children)

THE OPPORTUNITY


• Legg Mason has built a comprehensive program

with tools and resources for you and your clients on

this important topic.

• We will offer you tactical ideas for forging the gap

and becoming an advisor to your clients’ families for

many generations to come.

HOW LEGG MASON CAN HELP

CLICK TO EDIT MASTER TITLE STYLE

Today’s agenda Women: Not a niche market

Millennials: The next big thing

Family meetings: Facilitating dialogue

Steps to take today


WOMEN: NOT A NICHE MARKET

Women are due to inherit approximately 70% or $28.7 trillion in

intergenerational wealth transfers over the next several decades1

Women-owned businesses contribute $2.8 trillion annually to the economy1

Women make 80% of family household buying decisions, including those

related to banking and financial services1

Women comprise two-thirds of the U.S. workforce2

More than half of married women with business-related degrees out-earn

their husbands2

40% of American households with children under 18 now include a mother

who is either the sole or primary breadwinner3


8

Women investors have long been viewed as a secondary or niche

market to be served by specialists. Significant social and economic

trends are changing this.

Overall, women in the class of 2013 earned 140 college degrees at all levels

for every 100 men4

Women will account for a growing proportion of high net worth clients ($1-

$20 million in wealth)5

Women control 33% of wealth in North America and represent 37% of high

net worth investors6

Women “are more dissatisfied with the financial services industry” than any

other industry that affects their daily lives7

90% of women know they need to become more involved in their financial

affairs and 62% expressed a strong interest in learning more8


9

Women investors should be considered as a business opportunity

and as an avenue to gain access to the rest of the family network

(i.e., children/heirs).

10

You should make an effort to get to know your clients’ spouses

and/or develop a strategy to prospect for female clients

(underserved/unsatisfied).


Key considerations:

How much information do you have on your

female clients (e.g., background, education,

employment, business ownership)?

Do you believe that you have a strong

relationship with both the husband and wife –

particularly in the over 65 age group?

When working with female clients, do you go

beyond investment discussions to delve into

broader topics of long-term life goals and the

financial success of their family?

Action Steps/Tips:

Request that both parties be present at

meetings (male and female) and include both

in your ongoing correspondence

Maintain eye contact with female clients

Treat women as equal partners and listen to

their questions or concerns

Take your time providing status updates –

make sure everyone understands what you

are saying (e.g., financial terms)

Offer educational information, as needed

MILLENNIALS: THE NEXT BIG THING

There are currently 77 million Millennials in the U.S. (24% of population) – equal to

Baby Boomers9

Millennials will be roughly 50% of the U.S. workforce in 2020 and 75% of the global

workforce by 203010

Millennials are the most ethnically and racially diverse generation to date11

They are highly educated compared to previous generations – at least 34% have a

Bachelor’s degree11

They witnessed the Great Recession, are concerned about investing and are less

trusting of financial institutions12

Millennials are increasingly adopting a global mindset with factors such as social

responsibility and the environment frequently playing a key role in how they invest12

MILLENNIALS: THE NEXT BIG THING (AGES 18-34)

12

Millennials are a DIY generation and are more likely to use online

trading and internet banking. They are frequently on the web (via

social media) and value the use of technology to obtain, verify and

track information.

Millennials confront a higher unemployment rate than previous generations at every

education level13

More than half of Millennials state debt is “their biggest financial concern,”14 yet only half

have ever ordered a credit report15

Nearly 70% surveyed have not begun saving for retirement16

Millennials are delaying marriage, buying a home, having children and investing

aggressively (e.g., not planning for the longer-term)17

Referred to as an “Economically Lost” generation18

Accenture estimates that $30 trillion in assets will pass from Baby Boomers to

Millennials over the next 30 years19


13

Millennials typically want to remain in control of their investments and

describe themselves as “self-directed” and “conservative.” However,

given their general financial status and lack of long-term planning, they

could benefit from input and guidance on their finances.

14

It is imperative to build relationships with the next generation

of heirs. Those who don’t may find themselves left in the cold...

Key considerations:

Do you currently have relationships with the next

generation of your wealthiest clients? How close are

those relationships?

Do you have a plan in place to build new or stronger

connections? Have you used client segmentation to

identify potential target opportunities?

What kind of processes and communications do you

have to appeal to this generation?

What online tools can you leverage at your firm to

illustrate to Millennials the need to save/invest and

how to develop a path towards their specific goals

(short and long-term)?

Action Steps/Tips:

Coordinate in-person family meetings with your

current clients and their children

Leverage social media to develop an online

presence

Evaluate your current team structure and/or

succession plan. Do you have (or can you recruit)

younger partners that are effective in communicating

with Millennials or leveraging technology?

Leverage technology during in-person meetings as a

visual aid and to emphasize points raised


FAMILY MEETINGS: FACILITATING DIALOGUE

FAMILY MEETINGS – WHY A FAMILY MEETING?


• As a key adviser, you hold a crucial, but potentially unseen

role to the family members in the next generation

• In order for the family to get a sense of the older generation’s

regard for your counsel, you need to meet them

• You have a prominent role in facilitating the meeting, and in

helping family members connect on matters that are critically

important to their futures

FAMILY MEETINGS – POSITIONING THE FAMILY MEETING


• In a conversation with your client, position the family meeting

as an essential step to getting everyone on the same page

• Your goal is to gather their loved ones to talk about issues

and topics of consequence

• Your clients should introduce you as their trusted adviser

• You and your clients will field any questions the family

members and/or loved ones will have as the topic(s) is

discussed

FAMILY MEETINGS – RAISING THE TOPIC OF THE FAMILY MEETING


Sample script #1

When it comes to making decisions and plans about the future that impact you and

your loved ones, communication is key. Gathering your loved ones around a table or

in the same room is the best way to communicate directly with them about the plans

you’ve made. They can hear your perspective, learn of the decisions you have

made, ask any questions, and raise concerns they may have right away. In this

setting, you can address any family dynamics and get everyone on the same page

about your intentions.

This is also a good way for me (as your Financial Professional) to meet the family

members I haven’t met and get to know them. This will be invaluable should we

need work together on your behalf in the future. I can facilitate the meeting, prepare

the agenda and keep us on track. Then we can open the floor for discussion and

continue the conversation over a meal. If you like the way this initial meeting goes,

we can discuss doing other meetings around topics that matter most to you and

your family. I have some ideas of other items that you may want to address in the

near future.

SAMPLE FAMILY MEETINGS

Discussion of plans, intentions, and roles and

responsibilities

SAMPLE FAMILY MEETING #1

Purpose/Description

The purpose of this family meeting is for your clients to communicate to their family and

heirs their plans and intentions around the distribution of their assets. A vital part of this will

be defining the roles and responsibilities of the various heirs as well as general instructions,

including location of key documents, burial wishes and intentions for tangible personal

property.


Discussion of plans, intentions, and roles and

responsibilities



Sample agenda

Introduction

Overview of plans and intentions

Specific roles and responsibilities

Generation instructions • Location of key documents (personal information checklist and

emergency contact information, wills, trusts, power of attorney, etc.)

• Burial wishes and preferences

• Intentions for tangible personal property (including pets)

Open dialogue and Q&A

Guidelines for ongoing communication • Frequency of family meetings

• Frequency of document updates

LEGG MASON TOOLS & RESOURCES


Preparing for the Future:

Your Records and Roles Organizer

Personal Information

• Personal information checklist

• Beneficiary audit worksheet

• Emergency contact information

LEGG MASON TOOLS & RESOURCES


Preparing for the Future:

Your Records and Roles Organizer

Roles and Responsibilities

o Role of the executor

o Role of the trustee

o Role of the corporate trustee

o Role of the power of attorney

o Role of the advance health care directive

o Role of the guardian

Discussion of plans around aging and future housing

decisions


Purpose/Description

The purpose of this family meeting is for your clients to communicate to their family and heirs their plans

around how and where they will live as they age. This discussion assumes that you have engaged (or

plan to engage) in this level of planning with your clients. In this meeting, the discussion could include

reviewing the current housing options available, the pros/cons of each option, and how to factor the costs

of housing into financial plans. You could call this meeting after your clients have determined where they

would like to age, or you could structure this family meeting as a brainstorming session regarding future

housing needs.




Sample agenda 1

Introduction

Overview of the issue of aging and housing choices

Discussion of client’s housing choices

(for each selection, cover the following)

• Define housing choice

• Cover rationale

• Review costs and financial implications

Conversation around family member support • What are the specific needs?

• How much time will it take to manage those needs?

• Who in the family is willing and able to handle these needs?

• Will there be any damage to family dynamics due to unequal responsibilities?


Determine action steps (if needed)

Assuming decisions have been made

I

II

III

IV

V

VI



Sample agenda 2

Introduction

Overview of the issue of aging and housing choices

Discussion of the most popular housing options and their associated costs

• Aging in place

• 55+ Independent Living Communities

• Continuing Care Retirement Communities (CCRCs)

• Assisted Living Facilities

• Skilled Nursing Facilities

Conversation around family member support • What are the specific needs?

• How much time will it take to manage those needs?

• Who in the family is willing and able to handle these needs?

• Will there be any damage to family dynamics due to unequal responsibilities?


Determine action steps (if needed)

Assuming clients want to brainstorm with loved ones before making

decisions

I

II

III

IV

V

VI

Discussion of plans around aging and future housing

decisions



Facilitation Tips

Any discussion around the family home and where people live can be fraught

with emotion. Therefore, you will need to position this topic well, and set the

stage appropriately.

Each of these agendas have a significant amount of material to cover, so make

sure you are organized and concise in prepping for this discussion and that you

have cohesive materials to share.

1

2

TOOLS & RESOURCES

Aging and It’s Financial Implications: Planning for Housing

• Comprehensive client-approved

booklet with tools, worksheets

and resources

• Videos

• Podcasts

• Fully-scripted client seminar

• Prospecting letter

• Press outreach

28

A family meeting is the ideal opportunity to be introduced

to the family members, loved ones or heirs of your most

valued clients.

FINAL THOUGHTS ON THE FAMILY MEETING


• Flexibility and diplomacy are essential in a family meeting

• Encourage everyone to participate

• Be patient

• Your role is to facilitate the discussion, build family ties and serve as a

neutral and knowledgeable sounding board

STEPS TO TAKE TODAY

STEPS TO TAKE TODAY


• Be proactive – help your clients plan for the future and develop a bond

with the entire family network

• Carefully review the Legg Mason tools (client brochure/workbook and

advisor brochure)

• Analyze/segment your book to determine which clients are appropriate

candidates for the family meeting process

• Systematize the family meeting process for your practice by leveraging

our sample agendas, facilitation tips and sample opening scripts

• Streamline the steps so it becomes easier for you to host these meetings

with your clients

• Call on your Legg Mason wholesaler for additional resources and insights


“Before you go and criticize

the younger generation,

just remember who raised

them.” – Antoine De Saint-Exupery

All investments involve risk, including loss of principal.


© 2016 Legg Mason Investor Services, LLC. Member FINRA, SIPC. Legg Mason Investor Services, LLC is a subsidiary

of Legg Mason, Inc. 5/16

Legg Mason is a leading global

investment company committed

to helping clients reach their financial

goals through long term, actively

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