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BOCA RATON, Fla. – With economists predicting between $12 trillion and $17 trillion will pass from one generation to the next in the coming decade, credit union members will need an effective way to accommodate that “money on the move,” according to some industry watchers. More than 40 participants attended the “Putting Trust into Member Relationships” session at CUNA Mutual Group’s eighth annual Discovery Conference here. The June 26 session came days after MEMBERS Trust Company received federal charter approval as the first independent, national trust owned by credit unions (CU Times, July 2). The trust organization, formed by Suncoast Schools Federal Credit Union in Tampa and CUNA Mutual Insurance Society, is licensed to do business in all 50 states. Headquartered in Tampa, FL, MEMBERS Trust Co., will operate independently of Suncoast and CUNA Mutual, and shares of ownership will be sold to credit unions and other credit union entities. “If credit unions aren’t there to offer trust and related services, members will take these new assets or the assets they wish to transfer, and entrust them elsewhere,” said Dan Wroblewski, vice president of Wealth Management at CUNA Mutual and Gary Weuve, an assistant vice president of Financial Services at CUNA Mutual. Wroblewski told attendees it’s “extremely important” for members to have a viable estate plan, so assets can be distributed according to the member’s intentions. “Only through good estate planning, along with preparing the proper documents, can members meet their financial planning objectives and transfer assets according to their wishes,” Wroblewski said. Trusts can be crafted to offer a variety of needs and options to specify how proceeds are distributed to survivors or allocated for investment, Weuve said. “With second marriages and extended families, it’s important that wishes are put into writing,” Weuve said. “Trusts are a good solution to a lot of financial services issues, such as taxes, estate planning, and money management issues.” High net-worth members may be following a national trend of consolidating their accounts at a single financial institution, Weuve pointed out. “That’s good, if you’re a credit union and you offer trust services,” he said. “You need to offer a comprehensive package of services to help members simplify and control their finances. Banks and brokerage firms have trust companies. If you want to play, you’d better have one, too.” Wroblewski cited data showing 80% of inheritors switch their primary financial advisor after receiving $1 million or more. That percentage of switchers rises as the inheritance increases. Trusts also keep asset transfers private, unlike public records, which are part of a probate court action, Wroblewski said adding, that members can also use a trust officer of their choice, instead of one appointed by the courts, if the courts deem one is required. Because “members don’t go out looking for trusts,” financial advisors will play a key role in helping members become educated about trusts and trust services “They’ve been told they should have one, maybe by their attorney,” Wroblewski said. “They go to their credit union for help and that’s the moment of truth. If the credit union says `no,’ they don’t offer trust services, the member goes elsewhere.” -

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