Key Documents That Advisors Use for Client Plans

In a recent LinkedIn poll by chartered financial analyst Sara Grillo, 39% of 221 respondents felt the best time for clients to bring in documents is after the first meeting with a financial advisor. This gives the client an opportunity to size up the advisor and vice versa before revealing their financial status. Another 28% of polled advisors and financial professionals felt it was best for clients to bring them to the initial meeting to use as a discovery road map.

Either way, advisors are warming up to the idea that the human side of the conversation needs to take the lead in opening conversations with clients. Documents are then an excellent tool to understand clients’ planning and investment needs.

The list of documents that most financial advisors want to see can be extensive, encompassing 15 to 20 documents. This can be overwhelming for clients, so it is important for them to understand why a particular document is necessary. Boston Cardinal, founder of Vantage Impact in Minneapolis, recommends that advisors have a visual that displays their client onboarding process, where the client can see the steps and how each document assists in the overall picture.

Both advisors and clients may not realize how much information certain documents can shed. There are six main groupings of documents that spell out the client’s goals, desires and weak spots:

— Investment statements.

— Employer savings plans and benefits.

— Risk management documents.

— Debt statements.

— Business documents.

— Marriage and property documents.

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Investment Statements

These documents include brokerage accounts, mutual fund statements, annuity policies and checking/savings accounts. These documents spell out what a client has learned about investments to date.

An astute advisor can see how much a client already knows about the options available to them and how much risk they have been willing to take. A large cash balance in their checking account may draw attention to short-term goals, or it could indicate a client has significant concerns that the current economy may jeopardize their employment or squeeze a large financial commitment, such as building a house or paying for a child’s wedding.

Federal and state tax returns can be an opportunity to discuss the impact of taxes on investments and how different strategies can mitigate them. Annuity statements lend themselves to a follow-up tax discussion since they offer distinct benefits that complement any conversation about taxes.

Employer Savings Plans and Benefits

Social Security statements are important to ensure that a client is getting full credit for their contributions and that the amounts are accurately represented. Additionally, Social Security is an invaluable income source for most retirees.

Other documents can include qualified retirement plan statements for 401(k), 403(b) and Roth IRA accounts. These statements can help a client see whether they are taking full advantage of all the account options their employer offers or open a conversation on diversifying further than these plans allow.

Pension estimates from a defined benefit pension plan statement will include information about income available to both the retiree and their spouse. This can assist an advisor in discussing options for a client to maximize these benefits using life insurance.

Employers may also offer their highly compensated or key employees additional benefits such as stock option plans, non-qualified deferred compensation (NQDC) arrangements and supplemental executive retirement plans (SERPs). This can give the advisor insight into the client’s position within their company and even knowledge on the client’s employer.

Risk Management Documents

Life insurance policies can provide insight into the relationship a client has with other advisors, as well as the expertise of those advisors. For example, a large policy owned by a trust indicates that the insurance professional may be advising on estate planning in conjunction with an attorney.

These professionals can become excellent advisors that the client already trusts. The financial advisor will want to get to know these professionals and work with them as Centers of Influence, both for the current client and future referrals.

Along with any potential irrevocable and spousal trusts, a will indicates an attorney relationship that has already helped a client understand their role in their future estate distribution. A special needs trust indicates that the client has a disabled beneficiary that will need specialized planning to maximize benefits for their ongoing care. A financial advisor can even glean whether a client is being well advised by the projected premiums and methods of funding that the client is using with their insurance professional.

Business owners will want to show an advisor their risk coverages, such as business interruption coverages. Having coverage for these risks shows a client’s disposition for mitigating risk. An absence of them is an ideal opportunity for additional planning in coordination with an insurance professional.

Debt Statements

Cash flow is an important determinant in how to conquer debt. The client’s employment paystub is key to understanding how much income is incoming so that a client understands what they can safely spend each month for their obligations and desires.

A client’s largest debt is usually their mortgage. Reviewing mortgage statements can reveal a client’s financial position in the terms of the loan. A higher interest rate can give insight into their credit rating, which, coupled with their credit card statements, can shed light on their cash flow. Even the amount of their down payment can shed insight into their feelings on debt and savings in general.

Student loans are usually the largest unsecured debt and can offer insight into the client’s ability to stick with long-term goals. It can also shed light on their feelings about their current employment and any entrepreneurial aspirations.

Clients may also have secondary homes and investment properties; the details on these investments, especially if currently mortgaged, will reveal themselves in their respective loan documents.

Business Documents

A business owner should be able to provide key business documents, such as a balance sheet and cash flow statements. They should also bring their incorporation documents and business tax returns. An advisor should also be looking for buy-sell agreements, an employee stock ownership plan and business continuation documents. Finally, a truly astute advisor can ask a startup founder for their cap table to understand the trajectory of the firm’s growth and equity partitions of the founders and their investors.

Marriage and Property Documents

If clients have a prenuptial agreement or a divorce decree, it is prudent for an advisor to review these documents to ensure they have been properly signed and that the property in question is still in play. Advisors and clients alike have been surprised to find significant assets encumbered simply because the paperwork was not fully completed and filed, or that the property is no longer available.

If a client owns property, especially raw land, the advisor will want to review mineral rights, which have taken on a greater significance with the country’s renewable energy focus. Boats, collectibles and jewelry appraisals are also important to review, as these assets may fluctuate tremendously in turbulent economic times.


No matter what documents you ask for from clients, the request should be designed around understanding the client and what is most important to them. Bill Keen, founder and CEO of Keen Wealth Advisors, has even found that asking clients to sketch out their family tree lends important insight, opening up excellent conversations about caring for minor children, helping adult children and ensuring that aging parents can receive the medical and assisted living care they may need in their advanced years.

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