Fintech aims to digitize estate planning

Companies like Everplans and Yourefolio are finding success with advisers looking to expand planning capabilities

Feb 14, 2018 @ 5:34 pm

By Ryan W. Neal

Technology has digitized goals- and cash-based planning, but developers have largely ignored the final phase of an investor's financial life — after-death planning.

The estate planning world still relies primarily on paper documents and file cabinets. Some of the most tech-savvy advisers may use a digital vault like DropBox to share documents with clients, but that's about it.

(More: Fintech looks to the future of financial advice at T3)

Which may be why new technologies like Everplans and Yourefolio, two platforms offering a digital approach to legacy planning, are generating buzz among advisers.

Everplans was launched by co-founders and co-CEOs Abby Schneiderman and Adam Seifer in 2011 as an educational resource for end-of-life planning. The death of Ms. Schneiderman's brother made her realize the need for a digital platform to securely store documents and information.

Now Everplans provides advisers with a place to store a client's will and information on their financial accounts and insurance policies. Clients can also upload digital resources like pictures, videos, music and even instructions on how to take care of pets.

The company has raised more than $15 million in funding and now licenses a version of the software to independent advisers, life insurance providers, employers and financial institutions.

(More: The dealmakers financing top adviser technology)

Last week, Everplans announced a partnership with Raymond James to participate in a new suite of longevity planning resources for its 7,300 advisers.

Ms. Schneiderman says more advisers are looking at Everplans as a way to differentiate their firms in the face of fee compression, and to have conversations with multiple generations of clients.

"As advisers start to realize that they can really, truly add value beyond investments, beyond the balance sheet, they are seeking things like this that they can offer to clients," Ms. Schneiderman said. She's heard from advisers who are creating Everplans with their baby boomer clients, then sitting down with their children to show how exactly assets will be handled after their parents' death.

"Advisers can be the trusted go-to partner when it's time to carry out wishes," she said.

Ms. Schneiderman said new competitors like Yourefolio proves that legacy planning is starting to get the attention it deserves. She's confident in Everplans' history and user-friendly interface, but is "looking forward to other companies emerge in the space."

In addition to the anticipated wealth transfer from boomers to their heirs, Ms. Schneiderman says digital estate planning can help advisers and their clients reclaim some of the estimated $58 billion lost in abandoned bank accounts, unclaimed life insurance payouts and forgotten pension benefits.

"People's lives are more and more complex. Disorganization is becoming a really big problem for people," she said. "There is so much more than financial assets that needs to be considered."

A newer technology on the market is looking to go further and let advisers digitally create an entire estate plan. Yourefolio was launched in 2015 by Scott Huff, an investment advisor representative with the JK Investment Group, as a sort of eMoney for a client's end-of-life wishes.

"A lot of time, advisers are disconnected from the process. They hand over estate planning to the attorney and don't get in the middle of it," Mr. Huff said.

With Yourefolio, advisers can aggregate assets, build out a plan and stress-test it to find any deficiencies. It shows advisers what additional areas they need to address, and can recommend attorneys to create the final documents.

The company also has a document vault that stores documents and digital assets, similar to Everplans, but Mr. Huff says the main difference is that advisers own the estate plan and data, rather than a client-facing product like Everplans.

Yourefolio is currently integrated with TD Ameritrade Institutional, and Mr. Huff said he is currently working with Fidelity on an estate planning product.

Mr. Huff also cited fee compression as a driver of interest among advisers in technology that allows them to more easily offer additional services like estate planning.

"In the absence of value, price is everything. If you're not providing value, [clients will] find a better price," Mr. Huff said. "Don't become a commodity, become a necessity in their life. Add something they're not going to be able to get or they're not going to want to leave."

Sean Mullen, the national sales ambassador for AdvicePeriod, a financial planning and wealth management firm, said a digital estate planning tool would be a natural complement to his firm's existing financial planning technology. He noticed Yourefolio at T3 and said it "seemed like a common sense approach to family and estate planning."

"What I mean by that is the planning technology that's on the market right now is very investment goal- and cash-centric," Mr. Mullen said. He said that he's never seen anything else like Yourefolio on the market, and that currently advisers at AdvicePeriod must find their own way through documents with the attorneys.

Having the information in one digital location would help advisers and clients worry less, Mr. Mullen said. "I know I'm going to be in a good place financially when I'm dealing with all of this other emotional stuff."

While he's not familiar with Everplans, Mr. Mullen said he plans to look more deeply at estate planning technology to find something that would work best for his firm.

"Of course, it would have to integrate with all the rest of the technology to make it easy for our advisers," he said.


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