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Generational wealth: How to plan for and protect your family

Farmers National Bank’s Wealth Management team make it easy
Mark Wenick (1)
Mark Wenick, Executive VP and Chief Wealth Management officer at Farmers Bank office in Boardman.

For most of us, our thoughts automatically go to our children and what we hope to leave them. But we’ve gotten ahead of ourselves a bit; we have to address our own needs first. 

“When I think of generational wealth, I’m always very specific about taking care of the first generation,” says Mark Wenick, Executive Vice President, Chief Wealth Management Officer. “We sit down and talk to that first generation, make sure you understand what your health care needs might be, what your living expenses are and your philanthropic goals.”

Only then does the conversation turn to the next generation. While it’s only natural that we want to give our children every opportunity or a better start than we had, it’s important that we don’t make plans that put us in a situation that could be uncomfortable, where we’ll have to rely on someone else when we had the financial resources to take care of ourselves.

“Everyone has different vocations and family situations, so even within one family you want to take the time to be flexible and understand the approach that makes sense for them,” he says. 

At Farmers National Bank, your first point of contact is likely to be one of their private bankers. They sit down with you and try to really understand your needs; then they’ll bring in some professionals.

“We don’t expect everybody to know everything about wealth transfer and investments,” says Wenick. He oversees the five divisions of the company’s Wealth Management 360 portfolio: private banking, trust, retirement planning, insurance and investment services.

The private bankers will bring in subject matter experts who can help with all of the key aspects of generational wealth: financial and estate planning, tax, investment and fiduciary management expertise, which includes estate settlement and trust experts. Services can be delivered through the bankers themselves, in conjunction with Farmers’ brokerage group or through Farmers Trust Company.

One-size-fits-all doesn’t apply. Private bankers identify a client’s unique needs and then pull from all areas of the organization to support them. If you have your own advisors, such as attorneys, accountants or even your own children, they are a very welcome part of the process.

Many feel they already have a plan in place, as long as a will has been done or a trust has been drafted. They don’t think about all of the other ways that assets get transferred, such as contractual (joint bank accounts) or beneficiary designations (retirement plans, life insurance). 

“People tend to think that, upon death, that will was going to control everything, but it only controls those assets that are truly in their own name,” says Wenick. “Not many people have a lot of assets in their own name.”

Most clients start thinking about this in their mid-50s to mid-70s. “It’s hard to overlook the demographics of the baby boomers. This is really the time for the greatest amount of wealth being transferred in history,” he says. 

Wenick most enjoys meeting with young, up-and-coming professionals, those who are in their late 20s and early 30s, who are beginning to build wealth and start families, buy houses and build their own practices. For them, investing in insurance is much less expensive than for those in the older age groups. 

One of the best parts about working with a community bank is that there are different entry points up and down the spectrum. You can have your money managed at Farmers through a variety of different entities. 

“There truly is no hardcore minimum because there are different channels that deal with different sizes,” says Wenick. When working with the bank, for example, the minimum is negligible. On the brokerage side, you’d be looking at least $10,000. As you work your way up to the Trust Company side of things, the minimum is more like $250,000.

“The way we hope it works is that as these clients get older and more experienced, developing their careers, that we can move them through that continuum and ultimately get them to a place where the Trust Company is a perfect fit for their needs. That’s where most of the complex investing and planning is done, the true generational planning,” he explains.

The Trust Company is already managing many second and third generations. For a bank of Farmers’ size, having these different capabilities under one roof and being able to deliver them locally is a unique strength. 

The pandemic seems to have brought mortality to mind. Many did a lot more planning.

Some were determined to get into certain sectors of the market or investment vehicles. “We’ve seen a lot more of that type of proactivity on our clients’ parts,” says Wenick. “The questions to us are a little more sophisticated than they used to be.” 

Their job, as always, is to understand clients’ concerns so they can give the right guidance on what makes sense for each individual.

“There’s always an event that’s going to drive something, I don’t care which period of history you look at. Some are a lot more dramatic—such as the tech bubble, 9/11, the great recession in the real estate bubble and now the pandemic—those are real, true events. I think it’s important to look past the emotions of the event. Make sure you’re getting to the real desires and needs, versus the emotion,” he says.

Retirement and insurance planning are also part of the Wealth Management 360 approach. For many, their wealth is built up in their retirement plans, while younger folks take advantage of life insurance and protecting assets like homes, cars and boats with insurance. 

The group gets a lot of business from existing clients. Customer introductions are Wenick’s favorite. “We also get a lot from professionals in the community, from attorneys and accountants, the people who serve our clients in different capacities. Getting referrals from these centers of influence really excites us.”

For more information, visit Farmers Bank Group.

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