Survey: Estate Planning Lags At Some Family Businesses

The researchers also found a lack of use of common estate-planning vehicles. Only 50% of the respondents regularly use their annual gift exclusion, and 22% say they use generation-skipping trusts.

The lack of emphasis on life insurance, gift-tax exclusions and trusts may be due in part to "how advisors get in the door," says Joseph Astrachan, director of the Cox Family Enterprise Center at Kennesaw State University in Kennesaw, Ga.

Forty-one percent of the respondents named accountants as their most trusted estate-planning advisors, and 38% named lawyers. The number who named advisors with insurance-based professional qualifications was much smaller, Astrachan says.

Owners of family businesses tell Astrachan that they believe insurance agents and related advisors are far more interested in selling products than in providing impartial advice.

But Carol Wittemeyer, president of the Raymond Institute, says she thinks the typical family business has done better estate planning than some of the statistics indicate.

"Family business owners tend to think for the long-term," Wittemeyer says.

Reproduced from National Underwriter Life & Health/Financial Services Edition, January 27, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.