The survey of advisors to UHNW clients, carried out by the US wealth management firm, shed light on what such investors are mainly concerned about. The 2020 elections are putting tax on the richer members of society under the spotlight.

A survey of 150 trust and estate planners has revealed that their ultra-high net worth clients are preoccupied by uncertainty about tax as the 2020 presidential election cycle cranks up.

The study, conducted by Tiedemann Advisors, finds that 51 per cent said taxes are “top-of-mind” for their clients.

Although the Democrats haven’t yet chosen their candidate, the prospect that the candidate will push for higher taxes, such as cutting estate tax thresholds and even introducing a wealth tax, is the kind of eventuality that has already prompted industry commentary. And whatever the outcome, ballooning public debt means that any political party will at some point need to tighten the fiscal screws. 

High asset valuations (22 per cent) and political conflicts (13 per cent) were among the other biggest concerns from respondents. In general, nearly 80 per cent of survey respondents said that their clients were at least somewhat worried about safeguarding their estates during the election year.

“Preparing robust and thorough estate plans that protect assets against future tax law changes and political outcomes is vital in the early stages of an election cycle,” Jim Bertles, managing director at Tiedemann Advisors and head of the firm’s Palm Beach office, said.“Regardless of election results, the reality of the growing budget deficit is that tax revenues will need to increase, so we encourage clients to implement tax planning strategies sooner rather than later to mitigate any potential negative effects on their estates.”

Single family office trend
More than half of the trust and estate planning professionals surveyed (57 per cent) reported an increase in the number of single-family offices being formed in recent years. And almost one third (31 per cent) attributed the single-family office trend to the wide range of services that these structures provide to meet the specific needs of a UHNW family.

Other reasons for the growth of SFOs were attributed to respondents (23 per cent) saying that UHNW families wanted to get more control over their future, and 12 per cent wanted services that were not covered by traditional wealth management organizations.

The survey, which was fielded on January 13 and 14, 2020, was carried out at the 54th Annual Heckerling Institute on Estate Planning conference in Orlando, Florida.