Ever wonder what happens to you, as a client, when your financial advisor dies? Even though I am barely 50 as I write this, I actually have given this a lot of thought. Here are the things I’ve done to make sure my clients are taken care of in case I am suddenly unable to. (I used to say “hit by a bus”, but a bus driver once vented to me about how much he hated being cast as a mass murderer! Buses are quite safe, actually.)
First off, I use LastPass and it has a very complex password. My husband knows the phrase I use, and he would be able to get into my files if necessary. See XKCD Password Strength
Then he, or if not him, my adult child, would contact my associations to get help closing my practice and transferring my client files either back to you or to where you authorize us to send them.
I am a member of the Alliance of Comprehensive Planners. ACP is a community of tax-focused financial planners operating under the retainer model. There are about 200 of us. We all know each other: we trained together in the same methods, we work together in study groups and committees, and we have an annual conferences. Any of my clients would be a comfortable fit for anyone on the Alliance of Comprehensive Planners website. That’s the first place we’d look for help transferring clients as smoothly as possible.
If that doesn’t work for whatever reason, the next place to look is the larger umbrella group of Fee-Only Fiduciary Advisors. There are about 2000 members of the National Association of Personal Financial Advisors. Although All ACP members all belong to NAPFA, we’re a particular corner of the group. In general, most NAPFA advisors don’t do taxes, and most operate under an AUM model rather than retainer, but they are all upstanding professionals.
My contracts with people aren’t transferable: you’d need to authorize us to release your information to a successor firm, but we’d only choose a firm for financial advising clients from within those two groups. Tax clients are more challenging as they tend to get parceled out to various accountants based on each accountant’s specialties. But in practice, each year is a new engagement there anyway and the worst case scenario has you needing to get copies of the depreciation schedule and carryforward papers from my executor or executrix, and they’ve been instructed how to do that.
Disaster recovery is a whole lot less interesting than it used to be. Many of my core software packages are in the cloud, and the rest are run from a server that has nightly off-site backups. Specifically, I use Insightly as my CRM, Google Apps for my calendar, email and phone numbers, one of my main financial planning products is MoneyGuidePro and that’s in the cloud, but my various Excel spreadsheets (which don’t have identifiable data in them like your social security number or account numbers) are kept on a Google Drive. My Document Management System, eFileCabinet, is where my “paperless” office has its filing cabinets: also in the cloud. (The files in my office at home are nearly empty these days.) At this point ProsperiTea Planning is 100% in the cloud except for my own companies’ accounting, which are still done in Quickbooks and Quicken from my local server.
Tea & Taxes Company is harder. I run ProSeries from the server and have a lot of protection on that to make sure people can’t access your tax information. I only operate that from my desk. We have backups, though, every night to SOSOnline Backup, and my filing cabinet for my back files is the same one as I use for ProsperiTea Planning: eFilecabinet Online. (They were built for accountant’s privacy needs. I’m not wild about the portal software that goes with it, SecureDrawer, but the DMS itself is robust and has 10 year’s of data in it at this point.) (Edited to add: I changed my portal to ShareFile later in 2016.) Basically, if I had to change locations for Tea & Taxes I’d be down for a day or two while I re-installed software and did backup recoveries, but nothing more awful would happen than that. Knock on wood.
What about you? Does anyone know your master password? What phone numbers would you like whoever settles your affairs to have? What online sites would you want informed of your passing? If you can’t think of anyone else to tell, go ahead and tell me and we’ll all laugh and ignore it… but in case of death we’d go back and look in our notes (or open an envelope, that seems nicely dramatic to me) and see what you said.