Demand for wills and estate planning and financial planning is strong among retail banking clients, but some banks are coming up short, according to research from Investment Executive’s 2021 Report Card on Banks.
The “Support for wills and estate planning” category had an average performance rating of 7.7 this year, up from 7.6 in 2019 (the research was paused in 2020). But advisors gave the category an average importance rating of 8.7, leaving a sizeable satisfaction gap (the amount by which a category’s importance rating exceeds its performance rating) of 1.0.
“I get asked [about wills and estates] at least once a week,” said a Bank of Montreal (BMO) advisor in Alberta.
“The importance of [estate planning] has gone up during Covid because everyone wants their wills in order,” said an advisor in Ontario with Toronto-Dominion Bank’s TD Wealth Financial Planning division.
Branch-based advisors at both banks don’t have much to offer in these situations. When clients express interest in estate planning, BMO and TD require branch-based advisors to assess a client’s needs and refer them elsewhere — either to a private banking division or an external estate expert.
TD was the lowest-rated bank (6.5) in the wills and estate category, as it was in 2019. One TD advisor in Ontario said it’s easier to find estate-planning services from other banks online: “We’re missing the boat there.”
Dave Kelly, former head of TD Wealth Private Management and TD Wealth Financial Planning, said the bank will “refer [a client] to a qualified lawyer” once the client’s estate-planning needs are identified.
Bank of Nova Scotia, which had the second-lowest rating (7.2) for wills and estate planning, requires that advisors refer clients to experts for estate advice.
But a small number of Scotiabank branches have successfully tested “an estate centre of expertise” with dedicated specialists, said Sloane Muldoon, senior vice-president of retail performance with Scotiabank. “We’re looking to introduce this in all locations across the country.”
A Scotiabank advisor in B.C. praised this pilot project: “Now it’s much more streamlined, with a great team. That makes it much easier for us.”
The highest-rated banks for wills and estate planning were CIBC (9.0) and Royal Bank of Canada (RBC; 8.3). Both banks also received the highest ratings in the category in 2019.
“There is a lot of demand and interest in [wills and estate planning],” said Peter Lee, executive vice-president of banking centers, CIBC. To meet that demand, the bank offers a range of resources, including an advice centre “for more complex cases,” he said.
The importance of estate planning support was highlighted during the pandemic, said an RBC Financial Planning advisor in Ontario. “[Our support for wills and estate planning is] good, but last year there was a lot of backlog during the pandemic. It’s [an area] where clients need us most.”
Another category with a significant satisfaction gap (0.8) this year was “Support for developing a financial plan for clients.” The category had an average rating of 8.6, but its importance rating was 9.4 — both unchanged from 2019.
That lingering satisfaction gap is a problem, given that 100% of participants in this year’s survey said they craft financial plans for their clients. Further, advisors said more of their clients now have financial plans (64.5% on average this year, up from 59.4% in 2019).
In addition to having the lowest rating for wills and estate planning, TD also had the lowest rating (7.7) for financial planning support. An advisor in Ontario said TD’s new Wealth Architect software is “too structured and should have more flexibility. More training and support are needed as well.” Other advisors said they liked Wealth Architect once they understood it.
David Terry, vice-president and head of TD Wealth Financial Planning, said new tech launches typically come with “an adoption curve” and gave advisors credit for “how quickly” they adapted. “[Wealth Architect] is a very different planning tool and that’s on purpose,” Terry said, noting the tool offers a more visual, collaborative process between advisors and clients.
Scotiabank had the second-lowest rating (8.2) for financial planning support. Muldoon said the bank launched Advice+, an interactive planning tool, last November, which led to a 15% year-over-year increase in financial plans for clients. “[Planning is] easier for clients, and we also have coaches that we can now reach out to easily,” said one Scotiabank advisor in Atlantic Canada.
Besides being the top-rated banks for wills and estate support, CIBC and RBC also had the highest ratings (9.3 and 9.1, respectively) for financial planning support.
CIBC’s GoalPlanner tool, launched in November 2020, was a popular feature with advisors. “Clients come in asking about it,” said one advisor in Quebec.