Culturally aware estate planning: How to build trust and deepen relationships with clients of different cultures

Great client-advisor relationships don’t just happen by accident. They’re cultivated over time and founded upon a mutual sense of trust and understanding. This starts with communication that helps clients feel safe to openly share their financial goals and challenges without fear of judgment.

 In an increasingly globalized world, advisors have clients who often come from many different backgrounds, belief systems, and cultures. Perhaps some of your clients emigrated to the US from other countries or grew up with immigrant parents. As a result, their beliefs and attitudes around the topics of finance and estate planning might be completely different from yours. 

If we’re not mindful and aware of how cultures shape attitudes on estate planning, estate planning conversations can quickly turn awkward or downright uncomfortable for either party. That’s why it’s so important to approach these conversations in a skillful and culturally aware manner. Plus, being culturally competent as an advisor often opens opportunities to serve clients on a deeper level, helping them shape their wealth and legacy for decades to come.

Here, we help you understand the role that culture plays in estate planning decisions so you can build trust and more meaningful connections with clients while helping them meet their goals.

How culture shapes attitudes towards estate planning

Estate planning is a topic that touches many sensitive subjects like family relationships, death, and health and incapacity. Clients’ views on each of these topics is heavily influenced by how they grew up, colored by beliefs that have been shaped by their upbringing and culture.

It’s helpful to consider that the following often affect the way we all think, talk about, and approach estate planning tasks and conversations:

• Our beliefs about death, morbidity, health, and illness – our own and that of our loved ones.
• Our beliefs about family relationships, social connections, and the ability to trust others to look after us.
• Our beliefs about money, inheritance, and the role that both can play in one’s life. 

Beliefs around inheritance, for example, could determine whether someone has a will and a trust, depending on whether that culture believes in outlining these wishes before death. Some community-oriented cultures, like in Asia for example, may be used to the family simply dividing their assets amongst one another after someone dies. And cultural beliefs around who makes medical decisions in times of emergency or need, for example, could affect whether clients consider drafting healthcare directives and Durable Powers of Attorney. Cultures where it’s assumed that family members will take care of one another might not be able to understand the need for these documents, underscoring the importance of being sensitive to these cultural differences before discussing these topics with clients.

Being aware of how cultural conditioning and beliefs around these topics shift the way clients view estate planning allows advisors to more easily find common ground and nurture meaningful relationships even amongst cultural differences. One way to get clients to talk about their beliefs is to ask open-ended questions from a genuine space of curiosity about their lives and families.

Money and death: making the uncomfortable comfortable

Talking about money and death can bring discomfort to individuals from certain cultures and backgrounds. And this is often the reason why so many people procrastinate when it comes to estate planning!

When someone postpones their estate planning, they’re often exposed to many risks they might not even have considered. These include not being able to pass on their wealth in accordance with their wishes, having “bad” relatives make important decisions for them in difficult situations like incapacity, or leaving important matters of the heart (such as who cares for the kids after a parents’ death) to courts or other strangers. Simply put, procrastinating estate planning can cost their families or estates tons of time, money, and legal issues. Understanding the cultural reasons why clients may hesitate to talk openly about estate planning, money, death, or family relationships can help you make these conversations more smooth, helpful, and perhaps even enjoyable.

It might feel intimidating to think that you have to all of a sudden understand a variety of different cultures. But more important than understanding the nuances of every culture is simply having an open mind, being curious, and genuinely wanting to understand your client so you can guide them in a way that aligns with their values.

What motivates people from different cultures to think about estate planning?

It’s important to consider that different cultures have different motivators around what gets them to even consider starting on their estate plan.

According to Caring.com’s 2023 survey about what motivates people to get a will, one of the primary reasons for higher income Americans to get their estate planning done is family expansion. 

 It makes sense that when someone is expecting a child, they might be more likely to think about plans to ensure their family is taken care of if something happens to them. However, there are also cultures, like Lebanon, where the estate is considered first, even before a triggering life event happens.

Nina Dow, an estate planning attorney at Bowditch & Dewey, LLP, who was born in America and raised by Lebanese parents sheds a light on how the Lebanese view estate planning: 

“Americans tend to think about estate planning only after they get married and have a family or after a serious illness or other triggering life event. By contrast, the Lebanese think about their estate first, then marry and have children to whom they will eventually pass on their possessions and legacy. Perhaps one reason for this difference is that Lebanon’s unstable politics can make life precarious, and whatever possessions one has today may not exist tomorrow, so preservation and legacy are crucial.”

In a truly holistic financial planning conversation, topics like family, marriage, and long-term plans for the future are bound to come up naturally. That’s why advisors are in a unique position to use these conversations as a natural gateway to address estate planning with clients who may be sensitive to the topic. On the other hand, if a client comes from a culture that is intrinsically motivated to think about their estate and legacy, the advisor may actually have an easier time talking about estate planning as a prerequisite to other important financial planning conversations. 

Cultural driving forces around the world

In considering how clients approach estate planning and wealth management based on their background, it helps to look at the core primal forces that shape cultures around the world.

An article published in the Journal of Financial Planning in 2016 describes how researchers in cross-cultural psychology are organizing global culture patterns into three core culture styles: individualist, collective harmony, and honor cultures.

Individualist cultures value personal accountability and achievement and are relatively direct in their communication style. Collective harmony cultures put the needs of the family above the needs of the individual. Their communication style is more subtle, sometimes leaving important things unspoken. And in honor cultures, maintaining the reputation of the family is key. Family relationships may be hierarchical and it may take time to trust anyone outside the family unit.

Financial advisor Orlando Lopez, CFP®, CIM®, CIWM perceives the cultural preferences of his clients through the lens of a similar categorization: individualistic, community-oriented, group-oriented, and heavily influenced by religion.

Lopez is an Investment Advisor at RBC Dominion Securities living in Toronto, a city with a large immigrant population. As such, he has cultivated a deeper understanding of some of the nuances between cultural approaches to wealth management. Here’s an excerpt from a recent LinkedIn article that highlights some of these differences based on the different regions of the world: 

“In Western cultures, particularly in the United States and Europe, individuals are encouraged to take an individualistic approach to wealth management. Wealth is often seen as a measure of success, and individuals are expected to take responsibility for their own financial future.

In many Asian cultures, such as China and Japan, the approach to wealth management is more group-oriented. Family and community are highly valued, and people are often expected to support their extended family and contribute to their community. 

In many Middle Eastern cultures, religion plays a significant role in wealth management. Islam, in particular, has specific rules around how money should be managed, including the prohibition of interest and the requirement to give a portion of one’s income to charity.

In many African cultures, community is highly valued, and people are often expected to support their extended family and contribute to their community. Wealth is seen as a means to improve the lives of others, rather than an end in itself.” 

Lopez notes that these generalizations are not meant to put any one person in a box. Rather, they can help us understand a wider perspective to relate to clients better.

How these cultural driving forces shape estate planning decisions

Clients who come from individualistic cultures like America might be more proactive about estate planning than others. They may seek out the help of estate planning attorneys and financial advisors to grow and preserve their wealth and might be more open to talking about these topics so they can achieve peace of mind knowing that they have taken responsibility for planning their financial future.

Those from group-oriented or collective harmony cultures might seek active input from their family when it comes to drafting estate planning documents or making important life decisions. In cultures where family members are used to taking care of one another, it may seem counterintuitive to outline directions for who should take care of them in the event of incapacity. This might lead to a hesitation to use health care directives or powers of attorney in certain Asian cultures for example.

Those from community-oriented cultures might be eager to use estate planning as a way to support their community and give back. And those from honor cultures or cultures where religion plays a large part in daily life might be more likely to follow the standards of their family hierarchy or their religious guidelines when it comes to important estate planning decisions. Perhaps they may automatically contribute a portion of their estate to non-profits or they might be very private when it comes to talking about their family and the legacy they’d like to leave.

Estate planning through the lens of LGBTQ

In addition to different geographic backgrounds and cultures, advisors should also be mindful of how LGBTQ clients might perceive estate planning differently.

Financial advisor, speaker, and author dedicated to DEIB in financial services, Peggy Haslach, CFP®, CLY shares advice for how to best relate to LGBTQ clients when speaking to them about estate planning:

“My advice for guiding LGBTQ clients is that they must build trust with the clients quickly by using the words that the clients use. Ask questions about what they want to have happen if something happens to them. If possible, bring in an estate planning attorney or other advisor who is an expert on LGBTQ. Many people assume that since gay marriage is now settled law they can make the same assumptions. That is not the case. For example, Social Security survival benefits recently changed to count the time an LGBTQ couple was together before gay marriage was passed in their state. Lastly, when making recommendations remember that the laws can easily change so you will need to have a continuing relationship and update plans when their situation or the laws change.”Deepening connections with a client – regardless of their background or preferences – always starts with listening, understanding their needs, and not making assumptions. While not always easy due to our brain jumping to conclusions based on our own beliefs, it’s always worth the effort on the part of the advisor. 

Cultivate cultural humility and self-awareness

The Professionalizing Field of Financial Counseling and Coaching Journal discusses the concept of cultural humility as it relates to financial planning, defining it as “deep respect for clients’ experiences, perspectives, history, and cultural strengths.” 

According to the journal, “practitioners demonstrate cultural humility by approaching the helping relationship as a partnership; they ask questions about clients’ experiences, communicate respect, avoid assumptions, and reject stereotypes.”

In the same way, cultural humility can apply to estate planning conversations to ensure that advisors are aware of their own biases and values. It can be helpful for advisors to reflect on these and write down how their family history, cultural background, or education has shaped their worldviews so they can more easily spot their own views and accept those of others.

Along with cultural humility, it can be helpful for advisors to practice mindful listening when talking to clients about sensitive topics like estate planning. This can provide a space in which clients feel more supported and are more likely to open up and share without fear of judgment.

Practice mindful listening and connect 

Here are a few quick tips on how advisors can practice mindful listening to ensure they remain culturally-aware and cultivate deeper connections in estate planning conversation:

1.       Before the conversation, become mindful of what’s going on in your mental space. Do you notice any judgments, fear, or stress within your own mind? What are your personal views and attitudes on estate planning? Being aware of these can help you be more objective so you can be more open to other views and perspectives.

 

2.       Become mindful of how you’re holding your body during the conversation with the client. Non-verbal communication plays a large role in helping clients feel safe enough to open up and express themselves freely. Are any parts of your body tight, clenched, or constricted? How can you adjust your posture so the client perceives that you’re relaxed and open to listening without judgment?

 

3.       Focus on the client as they speak and wait for them to fully finish before responding. Ask clarifying questions from a genuine place of curiosity.

 

4.       If your client says something that surprises you or feels odd given your upbringing, remember our common humanity. Underneath any belief or perception of how things should be done is a deeper human desire to be happy, understood, and accepted.

 

The more you can interact with your client from a space of our shared humanity, the more you’ll experience meaningful interactions and gain the insights needed to support them in achieving their goals.

In addition to being culturally-aware in your next estate planning conversation with a client, it also helps to know which practical pieces of estate planning they should have in place to best protect and preserve their wealth. To help you with this, use our estate planning checklist to make sure you cover all the important topics and documents your clients should have to get their estate plan started. 

And if your client wants to see a visual representation of how their estate would flow to their heirs so they can plan accordingly, you can now show them with a customized estate planning report from Vanilla. Click here to schedule a demo today!

 

The information provided here does not, and is not intended to, constitute legal advice or tax advice; it is provided for general informational purposes only. This information may not be updated or reflect changes in law. Please consult with your financial advisor or estate attorney who can advise as to whether the information contained herein is applicable or appropriate to your particular situation.