Many CPAs are passive in nature and afraid to ask clients to pay them extra for financial advice. Yet, often they are better positioned even than planners to suggest tax-efficient investment strategies.
“I personally believe that every CPA either needs to provide these [investment] services or be much more in-depth in understanding them,” says John Azodi, a CPA and planner who runs a new program called CPAs as Advisors with Brokers International, a Panora, Ind.-based annuity marketing company.
“Often there is even an adversarial relationship between CPAs and investment professionals,” he said. “These groups really should work with each other because really they don’t understand each other. When the two don’t communicate, the client suffers.”
In its second year of operation, the program has taught new skills to 600 CPAs, 50 of which have made the transition to advisor in one form or another.
Azodi says he decided to partner with Brokers International on the program after making the transition from pure CPA to CPA cum advisor. The introduction of Roth IRAs in 1998 provided the impetus. That year, Azodi recommended to 100 of his 400 tax clients that they open Roths. A year later, only two of them had.
“To me it was a matter of convenience,” he says, adding that most of them didn’t want to meet and get to know a new financial advisor. “I thought, ‘I wonder if I could have done this myself how many people would have opened one.’ ”
To find out, Azodi obtained securities licenses so that he could do the work himself. The following year, 40 of his clients had opened Roths.
Five years ago, Azodi got more serious about developing his financial advising practice. In that time, he says he has scaled back on his CPA work and tripled his income.
The higher income is a significant draw. Azodi says that the average salary nationally for most CPAs is substantially less than that for planners.
In coming weeks and months, CPAs as Advisors will offer seminars in Baltimore, Indianapolis, Seattle, Kansas City, Nashville and Boston. Azodi says he also plans to take on 100 CPAs in a mentoring program that has yet to launch. More information about the program is available on his website.
Ann Marsh writes for Financial Planning, where this article originally appeared.
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