Louvre heist has advisors safeguarding, planning for client collectibles

The good news is that suspects have been rounded up in the Louvre heist. The bad news is the looted jewels have yet to be recovered.

For wealthy families outside of Paris, however, the headline is that even the most valuable assets can be vulnerable. And families should trust their financial advisors to help them document, value, and insure their treasures to prevent loss, confusion, or disputes later on. Even if these treasures aren’t the crown jewels.

When it comes to collectibles and heirlooms, Christopher Briscoe, vice president and director of financial planning at Girard, a Univest Wealth division, makes sure to include them as part of the overall financial planning process, including estate planning discussions. 

“Through initial data collection, we begin to inventory assets like collectibles, jewelry and heirlooms and have clients assign general values to them. Identifying these items helps track them and discuss the future of those assets, what will be sold, what will pass to beneficiaries and what will be donated,” Briscoe said.

Coordinating contacts, from accountants to insurers can be just as important as compiling the list of items for the plan. Effective communication among all parties can help clients stay organized, keep up with estate values, and make sure distribution plans are up to date and coincide with a client’s plan, according to Briscoe. 

“We want clients feeling comfortable with the knowledge that their wishes will be carried out properly and in an organized way,” Briscoe said.

Elsewhere, Oliver Pursche, advisor and senior vice president at Wealthspire Advisors, said art & collectibles are indeed valuable and definitely need to be accurately reflected on a client’s balance sheet, primarily because the IRS includes them in one’s estate from a tax perspective. As such, not planning appropriately could create an undesirable and potentially unnecessary tax burden on heirs.

“Identifying the value of each piece, ensuring it is appropriately titled and catalogued is important. Having the appropriate insurance levels to ensure any potential tax liabilities and liquidity needs are addressed is equally important,” Pursche said. 

Don't make these mistakes
 

The most common error made when it comes to addressing art, jewelry and collectibles in a financial plan is not appropriately titling the pieces in various trusts or LLCs. Advisors say this can create additional tax liabilities, disputes amongst heirs as well as missed opportunities to reduce taxes.

Having outdated valuations and lacking insurance coverage are also common issues, according to Pursch, as well as a lack of communication between family members.

“Not having annual family meetings to ensure that everyone's wishes are known, including the patriarch and matriarch’s desires for gifting certain pieces is also a frequent issue,” Pursche said.

Steve Lockshin, chairman and co-founder of estate planning platform Vanilla, agrees that "not specifying who gets what" can lead to estate planning problems. This can lead to fights over value and ownership since there are typically one or two very valuable pieces in an estate and more than one or two heirs.

“We have a network of appraisers including specialists for certain kinds of collectibles, work with top legal counsel familiar with these types of matters, and the same goes for insurers. Having the right team is critical when dealing with specialized assets,” Lockshin said.