There are many financial professionals who call themselves financial planners. Everyone from insurance sales people to investment brokers and managers or CPAs who dabble with planning call themselves financial planners. For better or worse, all of the aforementioned professionals have helped to shape the minds of clients as well as the expectations of financial professionals. And as a result, many great clients do not have a holistic plan (watch the video The Hoiistic Plan for Your Clients).

The clients of CPA firms often lack someone acting as their financial head coach, who can steer them through the inevitable twists and turns to be encountered in their financial and personal lives. Most of these twists and turns have a multitude of possible responses and the quick solution often may not be the best choice. Ultimately, the choices that feel best for your clients will often come from a holistic analysis that encompasses all financial and personal consequences.

As a client's CPA, you have good insight into their personal financial affairs. You see their sources of income and their deductions, you learn about their family, and you can easily get a glimpse into areas that need attention. From college savings to the ownership of rental or business property, the CPA viewpoint may be the broadest view that any of the clients' professionals have. For the CPA looking to build deeper relationships with fewer and better clients, recognizing open issues in the financial lives of your clients is a good start. The relationship strengthens when you are a part of the solution to help get these issues solved.



CPAs have chosen to serve clients in two ways regarding their financial plan. Most choose not to directly provide holistic planning services and serve as the exclusive head coach. They refer their clients to other advisors and are solicited by nearly every type of planner known to mankind. To those who prefer this less active role, the balance of this article will demonstrate what type of services your clients should be getting. It will allow you to be a deeper resource for them as you contribute needed expertise to the planning process.

Holistic planning takes a lot more time than simply running numbers and doing retirement forecasts. It involves full consideration of all the moving parts. It starts with cash flow today and in the future. Some clients have a clear vision for their future income or investments. Others are still in the building phase, where income and their future portfolio value are not certain. Some may need hands-on help with saving, budgeting and spending, especially on the qualitative side.

Helping a client to visualize their ideal future in terms of how they'll spend their 168 hours per week is magic. The knowledge of the planning professional can then help quantify the cost of these visions and understand what it will take financially to make that happen under a wide array of possibilities and scenarios, and then communicate that effectively to the planning team and the client. All decisions have quantitative consequences, but it is the qualitative discussions that often drive most quantitative decisions.



Beyond cash flow and incorporating a client's vision into the planning, a holistic plan must include analysis and guidance on some specific financial areas. These areas are risk management, investment advice, tax planning, retirement planning and estate planning. Beyond these mandatory cornerstones of the holistic planning process, client-specific subject matters may also need attention. These issues might include education planning, special needs planning, assisting with elder parent issues, or any other issue that will hamper or assist a client to accomplish a goal and live their vision.

Risk management, in my opinion, may be one of the largest gaps in many a client's financial picture. Unless a planner is committed to holistic planning, the risk management area frequently gets merely lip service from advisors. A holistic approach to risk management would ask the general question: What can happen to mess up this picture?

A holistic risk management approach would start by examining the areas of risk in your client's lives. Most people have homes and cars, and it is not enough for a financial planner to suggest that they speak with their property and casualty agent to see if their coverage is adequate. The holistic planner must review these contracts and ascertain if the coverage is adequate, too much or too little, and that it is supplemented with necessary add-ons for liability or special assets.

A similar analysis should be performed on the business side of the client's life. This area is one where not many planners have the competence or experience to perform at the highest level, but it still needs to be done. A mature ensemble practice probably has that expertise in house. If not, that doesn't mean you can ignore the topic; a holistic planner must be sure that the client is not exposed to unknown or unprotected risks.

A holistic risk analysis goes beyond the scope of insurance, and addresses retention and mitigation strategies as well. This would include a discussion of how the property (personal or business) is owned and if there are partners or other owners who may materially add to your client's risks due to history or (lack of) experience.



Because of the behavior of many financial professionals over the decades, often clients think that investing is wealth management. Of course, investing is one of the numerous moving parts to a holistic plan, but hardly the most significant. A holistic plan for your client's portfolio includes understanding the destination, an analysis of their current holdings and then a recommendation to bring their portfolio to a more optimal place. This plan should address the time frame, risk tolerance and the other resources available to a client. But beyond the basics of portfolio design, the holistic planner must pay attention to tax consequences, ownership issues and beneficiary elections to the extent that the investment is held in a trust, retirement plan or an insurance product.

CPAs know better than anyone that tax planning is a year-round endeavor, and not some magic wand that you wave on tax day. Especially in light of recent tax changes and the higher marginal brackets for high-income taxpayers, taxation is beginning to help drive decisions again in the minds of your clients. The holistic planner will have a good understanding of a client's current tax situation, yet offer proactive ways to reduce that bill going forward. The reductions may come as a result of the timing of income and deductions, creating deductions, or simple adding some tax alpha to the investment process.

Retirement planning involves more than letting the client know how much money they'll need to enjoy a comfortable retirement. It would entail going back to the client's vision for their future lifestyle and identifying what needs to be done to get there, and then assisting them to get there. Sometimes, the answer involves tough love and may require letting the client know that their objectives are unrealistic, and that they may need to make more or spend less. At a minimum, retirement planning needs to include a forecast under a few different scenarios, an analysis of retirement income options from Social Security or pensions, and regular monitoring to see that spending, investing and earnings have not strayed too far from the original forecast.

I'm always surprised by the number of people walking around with outdated or no estate plans at all. It's easy to see why this area is so problematic. Few people really want to step up and talk about their demise; the subject matter turns many clients off. Some clients think that an old will is better than no will, and their current cast of professionals often don't seem to be too concerned about the lack of quality documents.

Many planners do a cursory job telling clients that they need new wills and that they should consider trusts, durable powers of attorney and health care directives. With all due respect, a client doesn't need to pay a planning fee to learn that. What a holistic planner does for an estate plan is to discuss the options, from simple wills to trusts and protected entities. The holistic planner has the opportunity to invest the time with a client to be sure that they understand their estate plan, and make decisions that will suit their needs today and the needs of their heirs for many years to come. These discussions get very personal and should be specific enough to find out more than simply who gets what after they pass. Your discussions will be about the maturity and lifestyle of heirs, how assets are held for any surviving spouses, choice of trustees and how to deal with the potential re-marriage of your spouse.

When an estate is complicated with second marriages, children from more than one marriage, or special needs situations, the conversations get very interesting. For many clients, this may be the first time in their lives that they've been asked about how to accommodate and plan for these particular nuances.

Holistic planning is not an option for many financial planners. Some are too lazy. Others lack the knowledge or the commitment to their clients. But as we mentioned earlier, clients' perceptions of the planning process may be limited to what they've seen and heard before. It is up to you to alert them about the benefits of addressing these issues on a comprehensive basis.

The good news is that I believe the marketplace is changing. People are sick of getting sold stuff and getting sold a bill of goods about comprehensive or holistic services that a suitor wants to provide for them. As the CPA, you are in a good place to see that their needs are met or that you introduce them to a planner who is interested and capable of delivering that holistic plan.

John P. Napolitano, CFP, CPA, is CEO of U.S. Wealth Management in Braintree, Mass. Reach him at (781) 849-9200.

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