Chris Heilmann, U.S. Trust chief fiduciary executive, speaking at a recent meeting of the client advisory council, highlighted a number of the firm’s initiatives, many of which were shaped as a direct result of client input. “These new programs illustrate the importance that U.S. Trust places on listening to its clients and how we leverage their insights to help move our business forward.”
“When we say we listen to our clients, it gets straight to the core of everything we do,” says Keith Banks, president of U.S. Trust. “We have a specific, concrete approach to serving our clients and developing our business strategies. While we may begin with our own research and experience, and often feedback from attorneys and accountants who work with our clients, the process really relies on input from our clients themselves — via our client research panel and client advisory councils as well as through feedback from our advisors. In fact, our clients have had a meaningful impact on the development of a number of important strategic initiatives on both the investing and planning sides of our business, not to mention how we communicate with clients and how we market our services.”
Video: The Financial Empowerment Program
A Direct Link to Client Thinking
“We established the Client Advisory Councils (CACs) to bring together U.S. Trust’s leaders and clients from across the country for wide-ranging, in-depth discussions about clients’ wealth management needs and their relationship with U.S. Trust,” Heilmann says. Rotating membership on the council has enabled more than 100 clients to participate. “We want to know what our clients are thinking — about the economy, the markets, their investment portfolios and wealth transfer plans. More specifically,” Heilmann continues, “we want to know about their needs and how we’re meeting them — including areas of need that we may not be addressing as effectively as we might.” The goal, he says, is to use “forward-thinking insights from our clients to lead evolution in our industry, to envision new approaches and strategies, and to enhance the overall client experience to benefit each and every U.S. Trust client.”
In addition, the U.S. Trust Client Panel was established as a formal structure for obtaining feedback about how we communicate with our clients and develop solutions to address their needs. The panel, which consists of more than 1,000 members who serve for a term of two years, responds to periodic research surveys, providing valuable feedback and guidance in numerous areas. It has, for instance, helped us to reshape this very magazine, in terms of its content, presentation and delivery, including the development of the web-based version of Capital Acumen. It has also helped us think about and develop our many other thought leadership publications, conference calls, web broadcasts and other content that we provide to our clients — in terms of frequency, areas of focus, the depth of the discussions and overall usefulness.
Client Impact on Our Investment Approach
“Direct client input is obviously critical when establishing a wealth management strategy and designing portfolios for our clients,” says Chris Hyzy, U.S. Trust’s chief investment officer. “Dialogue between advisors and clients occurs early on in the process and then on an ongoing basis thereafter.
“Input from clients has also helped us to develop our new proprietary investment strategies,” he continues. “Through feedback from advisors and the CACs, we learned that our clients were increasingly interested in a number of investment themes identified by U.S. Trust’s analysts and Investment Strategy Committee. As a result, we created our proprietary investment strategies, seven model portfolios designed to offer clients direct and immediate exposure to these powerful investment themes — potential alpha-generating strategies, strategies designed to capitalize on growth overseas, and several others.
They Listen to Me
So says one longtime U.S. Trust client. “I’ve always felt that my U.S. Trust team has been responsive and thoughtful. They know where I’m coming from and what my priorities are.” Like many U.S. Trust clients, he provides much of his feedback about his financial situation and his relationship with U.S. Trust via regular conversations with his advisors. “We meet a couple of times a year, and maybe we have half a dozen phone calls, all on an as-needed basis,” he says. “We talk about portfolio performance and discuss any financial issues I may have.”
Over the years, as his objectives and needs have evolved, so has his relationship with U.S. Trust, growing from investment management exclusively to include a mortgage, deposits, a line of credit and estate planning. Recently, his two elder daughters participated in the firm’s Financial Empowerment program. “My wife and I had been thinking that our kids were becoming old enough to develop an understanding of their wealth, and my team mentioned the Financial Empowerment program. My daughters were really impressed with the program and wanted to sign up for more. They came back with a lot of questions and observations, and we’ve since had a number of productive conversations about our wealth. They have a solid baseline understanding when it comes to the financial decisions they’ll have to make in the next few years. Whether it’s buying a house or drafting a prenuptial agreement, they know the issues they need to be thinking about and the right questions to ask. The program certainly exceeded my expectations, and I’ll definitely consider it for my other children, when they get older.”
The bottom line, he says, “is that U.S. Trust listens — and responds — to my wealth management needs.”
“It’s also important to note that client input frequently informs our investment strategy,” adds Hyzy. “Our investment strategy team spends a lot of time on the road talking with clients, who have an incredibly broad range of professional experience — they are business owners, board members and professionals in a wide variety of industries — and their unique perspectives offer an invaluable complement to our own investment research.”
Guidance for Trustees and Those who Self-Trustee
“Clients have also been instrumental in the development of key strategic initiatives on the planning side,” Heilmann says. “We were creating programs that our own research told us could be important. But speaking with our clients — often through the CACs — proved crucial. Those conversations allowed us to confirm that we were on the right track and helped us to shape our approach.
We want to continue to provide wealth management solutions that are truly helpful to our clients.
“We had been aware, for instance, that individuals are increasingly being named as trustees, personal representatives and executors,” says Heilmann. “So we had been increasing our focus on fiduciary administration — assisting those who find themselves in a position to be their own trustee, or to be a trustee, executor or personal representative for a loved one or friend. But the real validation for us came directly from our clients themselves, who confirmed that this was something that we should be paying attention to. And then they helped — and continue to help — us to craft our approach to meet their needs more effectively.”
Addressing the Unique Planning Needs of Women and Same-Sex Couples
“Both women and same-sex couples have significant — and unique — planning needs,” says Heilmann. “Compared with men, women are more likely to be primary caregivers, face a significant retirement income gap1 and outlive their spouses2 (if married).
“Same-sex couples, for their part, face a different set of wealth planning challenges,” he says. Same-sex spouses, domestic partners, and members of civil unions or any other committed same-sex relationship simply do not enjoy the same legal rights and benefits as opposite-sex married couples with respect to a host of issues, including wealth transfer, tax planning, retirement benefits, decision-making during incapacitation and at death, adoption and child care, and even citizenship.
“Understanding that we serve a diverse client base, we wanted to be certain we were appropriately addressing the specific planning needs of women and same-sex couples,” says Heilmann. “While the planning tools to help meet these needs are no different from the tools we use with any other client, a thorough understanding of the unique planning challenges and needs of these groups is critical to creating appropriate solutions. We spoke at length with our advisors and our clients, including members of the CACs, and they worked with us in thinking through and developing our approach to same-sex couples and women. With their input, we’ve developed tools to help our advisors better understand the unique dimensions and requirements of these groups and created client materials that more directly address their concerns and needs. In short, our clients made sure we got it right.”
A Holistic Approach: Next Generation Education and Eldercare
“We are committed to providing solutions that address the wealth management needs of our clients and their families, including their extended families,” says Heilmann. “Our Financial Empowerment program is an outgrowth of that commitment, and it was developed as a direct result of feedback we received from our clients who were concerned about their children’s ability to handle wealth responsibly.” The program, designed for young adults, addresses financial basics, philanthropy, trusts, protecting wealth, dealing with life events from a financial standpoint, and other issues. “Client input was critical in creating this program, and it continues to be. Recently, in response to specific client comments, we launched Financial Empowerment Online, a web-based tool that supports the program.
“At the other end of the age spectrum is our recently launched eldercare program,” Heilmann explains. “We knew from our clients and our own research that there was a need for eldercare services. So we gathered professionals from across U.S. Trust to develop a comprehensive eldercare program. Once again, we spoke with our clients as part of the development process, and their guidance — about the services that would be most helpful to them — has been invaluable. The program focuses on four key areas: organizational services; care coordination services; financial planning, including long-term care cost planning; and estate planning services.”
Offering Our Clients Relevant Solutions
“At U.S. Trust, we are proud of our long, rich history of serving clients and their families, but what’s most important for us is the relevancy that we bring to our clients,” says Banks. “We want, in short, to continue to provide wealth management solutions that are truly helpful to our clients. Whether we’re talking about initiatives on the investment or planning sides of the business, or client communication and marketing efforts, we have found that vetting our analysis of current and emerging industry trends — along with the ways we might respond to those trends — with our clients is the most effective way of offering the most useful solutions for their situations.”
Latest available data: 1Phoenix High-Net-Worth Market Insights, October 2007. 2U.S. Census Bureau, 2007.
Always consult with your independent attorney, tax advisor, investment manager, and insurance agent for final recommendations and before changing or implementing any financial, tax, or estate planning strategy.
Case studies are intended to illustrate products and services available through U.S. Trust. The case study presented is based on actual experiences. You should not consider this as an endorsement of U.S. Trust or as a testimonial about a client’s experiences with us. The investment strategies discussed are not appropriate for every investor and should be considered given a person’s investment objectives, financial situation and particular needs.