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The skills of senior financial planners are frequently focussed not only on financial products but also on assisting clients more generally in the administration of their affairs.

Death, disability, incapacity, domestic relationship breakdown, retirement, receipt of an inheritance, moving overseas to work, or retiring are examples of client life events in which financial planners assist clients to manage the financial aspects. Thus, financial advisers are familiar with being drawn into matrimonial property disputes where a relationship has broken down and division of relationship property must be agreed. Bankers, lawyers, tax advisers, accountants and other advisers may also be involved to manage such events in co-ordination with the financial planner.

A new opportunity has now arisen for financial planners, lawyers and other advisers to work together in helping separating couples reach agreement on dividing their relationship property outside of court. This is known as Collaborative Family Law¹ and, having begun in the USA, is now well underway and gaining substantial momentum in Australia.

Collaborative Family Law has been operating in the USA and Canada since the early 1990's, but is also recognised as a successful means of alternative dispute resolution in UK, Ireland and Europe.

At its heart, collaborative family law is a method of dispute resolution that focuses on assisting clients to determine common ground from which an ultimate solution can be crafted. Such solutions may then use court orders to be implemented.

One of the reasons that collaborative law has been successful is that the lawyers engaged are disqualified from acting for the client should collaboration fail. A disqualification agreement underlines the fact that all the parties are attempting to achieve settlement without threatening or being subject to the threat of court proceedings when things become difficult.

The collaborative process is not suited to all separating couples, since it requires goodwill and commitment between the parties. However, for couples willing to undertake the collaborative route, there are clear advantages over the traditional court settlement. The process is often quicker, less costly and has less of a detrimental emotional impact. This in turn may help ‘co-parenting' in the future. Moreover, a collaborative settlement represents the couple's own solution, rather than a solution imposed by a judge.

How then, does the independent adviser contribute to the collaborative process? Basically, as a ‘financial neutral' at the collaborative ‘four-way' meetings between the separating parties and their respective solicitors. In this capacity, the adviser is not providing specific advice, but instead offers generic consultancy which assists with the decision-making required in dividing assets.

But this is only one direction that the collaborative process has taken. The principles are being applied by Australians to tackle both conflict and non conflict situations as a means of achieving global best practice outcomes. While family law has seen the main thrust of development, the principles are well applied to general dispute resolution and non contentious multi party representation in the corporate, commercial, trusts and estates fields.

Think of the issues created in civil and commercial disputes including partnership agreements, commercial contracts, workplace relations, building and construction,
interests in land planning and environment, and of course wills and estates. Working with these kinds of issues is ideally suited to financial planning practices that operate
on a fee-based model similar to the advisory professionals in law, tax and accounting.

Of the several different directions that collaborative practice has taken in Australia, Estate Planning is emerging as the most rapidly growing service this year. The common interests in multi-generation wealth management strategies need efficient coordination by a lead adviser, of a team of complementary professionals, to make use of the collaboration principles.

Financial Planners who are focussed on building fee based practices need to consider skilling up to function in the more complex service environments of collaborative professional practice, estate planning and estate administration. These planners also need to consider:

• Their plans to build or expand a fee based element to their practice this year?
• How to receive more value from their network of professional referrers?
• How to increase their relevance and value to clients this year?

For advisers wanting to know more about the collaborative principles, Collaborative Professionals (NSW) Inc is hosting the first collaborative practice conference in the southern hemisphere in Sydney 26 to 29 March 2009, which will in part explore these themes. Should you be there?

The conference will include a workshop for Financial Advisers run by Amy Jensen Wolff CFP who has 13 years of experience in using the principles.
For advisers wanting to know more about this process visit: www.CollaboratingDownUnder.com or www.collaborativepractice.com.au.

While estate planning is set to be a considerable growth area for financial advisers in 2009 it is an area that requires specialist knowledge.

Given the potential complexity of the advice it is worth advisers aligning themselves with a suitably qualified Estate Practitioner Mentor in the early stages. It is now common for clients to have assets both in different states and in different countries with the resulting tax complexities. It is also very common to have fragmented or blended family groups. This requires advanced soft skills to define with clients their core drivers and the potential family tensions that may jeopardise the estate plan.

For those planners agile enough to change and learn to deliver comprehensive estate planning services the rewards, other than the direct advice work, are considerable and may include:

• A much closer relationship with clients
• Increased product sales through meeting a client's wider range of needs
• Prospecting and referral access to existing clients extended family, business and professional networks
• A feeling of satisfaction not always found in pure investment work
• An increase in the value of the practice through more loyal clients and a demonstrated fee income stream

Estplan Pty Ltd is taking the initiative in providing mentoring, training and commercial support services for advisers wanting to take up this rewarding role.

¹ For more information please see
www.collabprofessionalsnsw.org.au/family/collaborative-law.html