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Settling Estates on the Web

Estate Logic shows some promise, but is there a market for it?

Joel P. Bruckenstein, 11/13/2008

Clients generally do not look forward to estate planning, but it is something that needs to be done. Unfortunately, roughly 50% of Americans don't even have a basic will according to FindLaw.com. Even assuming that your client does have an up-to-date estate plan, the odds are that he or she will be bequeathing some headaches to the executor of the estate--someone who is often a close friend or a relative. An executor is responsible for carrying out the directions set forth in the will. Responsibilities of the executor include making an inventory of all assets, approving of disapproving creditors claims, claiming insurance proceeds and other benefits, obtaining information about heirs, distributing bequests to heirs and charities, and more.

In addition, although not necessarily a formal duty, some executors get involved in the softer side of estate settlements, such as passing on family stories that the decedent wants preserved for future generations or carrying out personal wishes that fall outside the scope of the will.

Executor's Resource is a firm dedicated to making the process of settling estates easier. The conceptual underpinnings of Executor's Resource  were developed by, Myra Salzar, CFP, of The Wealth Conservancy, a fee-only financial planning firm that specializes in inherited wealth. Simplifying estate settlements might sound like an ambitious goal, but the firm has a well thought out plan that just might succeed.

Executor's Resource recently launched its first product, a Web-based application called Estate Logic. The firm plans to offer the application through multiple sales channels including online retail banking and employee benefits plans, but the financial advisor channel might prove to be the best fit for a product of this nature, because this is the type of offering that is sold, not bought. By that I mean most people do not wake up in the morning and say "Hey, I think I need to purchase an online tool that helps me organize my estate." This is the sort of product that the client needs to be encouraged to use by a trusted advisor, and it is the sort of product that requires monitoring and updating; these things are more likely to be done if the advisor is involved.

The advisor edition of Estate Logic includes two components: an advisor Web site and the client Web site. To get started with Estate Logic, you must first register with Executor's Resource as a "partner." Currently there is no charge to register as a partner, although it is likely that a one time charge will be instituted in the future. Registrants are sent an e-mail with a user name and a password granting access to the advisor Web site.

At the top of the entry page is the Estate Logic branding. To the right of that is a picture that can be replaced by your firm or your organization's logo.

On the left of the page, advisors can update their password and contact information. On the right is the place where users customize the client-facing portal. Here, you can upload a picture of yourself and up to four lines of text. This information appears on the "My Profile" tab of the client's portal, along with all of their personal information.
Below that is the practice-management section. Here are links to the Implementation guide, marketing templates, and service templates and a short paper that helps users segment their client base so they can target the best candidates for the service first.

The marketing section currently includes the following templates: A client introductory e-mail message to help announce the new service to your clients, a brochure, a marketing message for you client statements, a sample news release, and a short article about selecting an executor for use in a client newsletter. Currently, there are four service templates to share with clients. Each is an action plan and a checklist that corresponds to one of the four sections of the client Web site.

At the bottom of the page is a client dashboard. This dashboard allows you to view a list of all clients subscribed to the site, their level of service, and the length of their subscription to the service. The dashboard alerts you to the last time a client logged on to the Web site, so advisors have some idea of when and how often they are using the service.
Clients can sign up for one of three levels of service. Basic provides full use of the tools, but no online storage of documents such as wills and trusts. Deluxe offers 250 MB of storage in addition to the basic features. Premium offers 2 GB of storage, and it allows clients to permission other advisors, in addition to you, access to the application in order to allow collaboration among all a client's advisors.

The annual discounted price to advisor clients is $100 for Basic, $120 for Deluxe, and $180 for Premium. There are two methods models for delivering this service to clients. One is to pay for clients and incorporate the charge into your annual fee/retainer. The other is to provide a link and encourage clients to sign up and pay themselves. You could also try some sort of hybrid option, perhaps paying for the initial year and making clients responsible for renewals. If they've committed to doing the initial work that the site requires, it is much more likely that they will stick with it.
Once a clients are enrolled, they go the sign-in page, enter their user name and password, and arrive at the home page. The application is divided into four main areas: Estate Documents, Financials, Family Legacy, and My Instructions. Users can navigate directly to any of these areas by clicking on the icons, clicking on the hotlinks, or using the tabs at the top of the page.

Each of the four areas is pretty much self explanatory, although help is available. For example, if you enter the Estate Documents area, you'll see links along the left side of the page. These serve as a checklist of documents that need to be accounted for. The list includes things like birth certificate, adaption papers, military discharge papers, will and powers of attorney.

Click on a link, and a screen appears that prompts you for all relevant information related to the document. If a document relates to a specific asset (a deed to an investment property for example), you can create a link here for easy retrieval when needed. There is also a facility to upload a copy of the document to the Web site. If the basic service has been chosen, documents cannot be uploaded, but you can note where the document is stored in the description field. Since storing all of the documents in one place is a real convenience, and since the deluxe service only costs $20 per year more than basic, I suspect that most clients will choose that option. PAGEBREAK

The other main areas of the program work in a similar fashion. The Financials area is divided into two categories: Assets and Liabilities. In order to begin entering assets (or liabilities) you must first create at least one section under each category. For example, if you created a section called "retirement assets," it might include IRA's 401(k)'s and also pensions or annuities with residual values or survivor benefits.

The Family Legacy section is where the executor's name and contact information is listed, as well as that of other key contacts. This is also a place where photos can be stored. A client might want to store pictures of personal property to insure that the executor is aware of the items so they can be bequeathed according to the client's wishes. There is also space here for "family stories." If the client wants to preserve some family history and pass it down to future generations, the stories can be safeguarded here.

The My Instructions area is where the client can preserve specific instructions for the executor that fall outside the scope of legal documents such as the will and powers of attorney. A separate section is set aside for personal messages and wishes. Here, the client can create and store messages for loved ones, for example.

Three other areas round out the program. My profile is primarily for administrative tasks. Customer service is self explanatory. Resources contains information about the role of an executor, guidance on how to use the program, and coming soon, a library of professionally written articles about the estate planning process.

Overall, Estate Logic's site offers a comfortable user experience. It is easy to navigate, it uses lay terms that will not intimidate clients, and it is responsive. The only issue my test of the site raised was whether or not is it is advisable put the onus on clients to create their own sections within the asset and liability categories. On the one hand, flexibility can be a good thing, but on the other hand, an advisor could end up with fifty clients using the site, each with totally different organizational systems. That might turn into a nightmare.

While to price to clients is quite reasonable, the only real question I have is whether or not the service is necessary at all. An advisor with an existing client portal capability and some online forms could easily duplicate much of the functionality here, but my guess is that most won't; so the latter group are good candidates for this service. Furthermore, Executor's Resource plans to introduce a second product soon that could substantially increase the allure of Estate Logic. This yet to be named product will be a separate portal for executors that will link to the client's Estate Logic account. The Executor's portal will include forms and templates to aid the executor in his or her duties. By linking the information contained in Estate Logic with a portal that further facilitates the executor's job, Executor's Resource may in fact create a value proposition that advisors and their clients find worthwhile.

For further information, visit www.estatelogic.com.

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