YOUR PRACTICE-Financial advisers brace for boomer wealth transfer

Thu Apr 3, 2014 2:56pm EDT
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* Boomers seen inheriting C$1 trillion in next 15 years

* Advisers look to insurance, trusts, beneficiaries to protect wealth

* Risk of losing clients upon inheritance looms large

By Andrea Hopkins

TORONTO, April 3 (Reuters) - The looming shift of money to and from the baby boomers promises to be the greatest intergenerational wealth transfer in history, and Canadian financial advisers are looking to investment and insurance strategies to help clients hold onto their money.

A Decima Research study found Canadian baby boomers are expected to inherit C$1 trillion ($906 billion) from their frugal Depression-era parents in the next 12 years, just as their own cash-strapped offspring look to them for help to get a start in life.

"Advisers like myself are typically working with the people that will receive the money and be giving the money -- the sandwich generation," said Brian Burlacoff, a certified financial planner at Sun Life Financial in Toronto.

As in most industries, baby boomers make up the bulk of clients in wealth management. With the front of the boomer wave turning 68 this year and the peak in their mid-50s, the challenge of inheriting money and planning for their own estates is becoming a top priority for clients and advisers alike, in part because advisers risk losing much of their own business if their clients' heirs take their money elsewhere.

Burlacoff and other advisers are looking to a mix of strategies, from naming beneficiaries to creating trusts to using insurance products to guard against tax and probate costs for their clients. No longer is a simple will the best way to go.   Continued...