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CPAs across America likely perform elements of financial planning without giving themselves credit. With little additional effort, CPAs can transform their clients’ lives.

My experience shows that the obvious often stares us in the face—we just don’t see it. When I was a COO and CFO of one of America’s leading jewelers and a leading healthcare company, I always looked at how I could expand the business. What I discovered repeatedly was that I was always closer than most imagined to adding services, shifting product mix or some way to make our product more accessible to acquire by just making some small changes.

The same is true for CPAs, who are likely performing financial planning without realizing that these activities are subsets of financial planning.

How Close is a Typical CPA to Financial Planning?

We’ll break down a few of the services from Figure 1 that integrate elements of financial planning and examine what CPAs already do in a typical accounting practice and their complementary skills. Most may realize that creating transformative client relationships often only requires a little more work.

What CPAs Do: Tax-related Financial Planning

Financial planning has one common thread: Taxation. Tax compliance impacts every aspect of financial planning and tax expertise is a unique feature of the financial planning opportunity for CPAs, as is estate planning expertise.

These features are so important to accountancy that we have robust committees dedicated to them and the related sophisticated personal and business estate and tax planning. What is surprising is that too much weight is given to adding one program that integrates the planning you already perform into a financial plan.

What CPAs Can Add

A minor addition in this area to help clients take advantage of a rarely used tax strategy is the tax and estate planning opportunities for retirement plans. Less than half of 1 percent of business owners with employees take advantage of coordinating plans that fundamentally change long-term outcomes for families and business owners.

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What CPAs Do: Goal-focused Financial Planning

Taxes impact all business decisions to help fulfill client visions and goals. CPAs may counsel clients on their goals and how to execute them; you help them outline business planning, cash flow and various integrated tax strategies; you prepare the outcomes reflected on Schedule A, Schedule B: Interest and Dividends, and Schedule D, capital gain recognition; and you may even counsel on 1031 exchanges with sales of property.

What CPAs Can Add

One way CPAs can add support to your client’s goals and enhance the their current planning experience is by adding a financial plan and forming deeper relationships with clients around what’s important to them. A financial plan integrates the planning you have performed for them and adds modules that allow the client to see the value you deliver. Tying together your client’s vision, values and goals will enable you to demonstrate the impact of planning you already do in a way that consistently reminds them of the value your services have delivered. And when you meet those goals and needs, a greater appreciation and trust forms.

What CPAs Do: Retirement Financial Planning Activities

Tax planning can become more straightforward after your client retires and many retirees may move to another practitioner due to a lower level of sophistication or may even prepare their own returns due to the simplicity. While you may already be suggesting contributions to IRA, 401(k), profit-sharing and defined benefit plan/cash balance plan, enhancing service to your clients at this stage by integrating a planning specialization and revenue generated through a multi-faceted relationship is key.

What CPAs Can Add

Gain additional insight into retirement areas such as 401(k), profit-sharing and cash balance plans to benefit your executives and business owner clients. The benefits to your client could include significant tax deductions, the ability to help them reduce turnover and helping them design custom plans to fit their corporate culture.

The enhanced outcomes for clients include things like the elimination of state income tax; the potential elimination of Social Security and Medicare tax; the accumulation of significant assets in a Roth that is beneficial to heirs; and tax deductions for shareholder/member/partner contributions to retirement plans.

What CPAs Do: Investment Planning Activities

CPAs routinely suggest contributions to various plans, including IRA, Simplified Employee Pension plan, 401(k) and SIMPLE-IRA, as well as work with clients regarding the timing of sales due to tax law changes and may counsel on 1031 exchanges with sales of property and Opportunity Zone credits.

What CPAs Can Add

Even if you don’t have plans to manage money professionally, adding some basic knowledge will help your clients ask the right questions and enhance investment planning activities related to their financial planning experience.

Conclusion

Offering financial planning services to clients improves relationships and outcomes. When clients understand how your advice is tailored to their best interests, it is easier to implement the strategies you know are in their best interest. A deeper understanding of how to benefit their companies and families is just a few steps away.

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