Integrating financial services into your practice can help broaden and expand your client base and profitability.
The top issues facing the majority of CPA firms today can be broken into three major areas: finding and keeping good talent, succession planning and pressure to increase revenues and profitability.
The first issue: finding, recruiting and retaining good talent, is not likely to go away soon. In fact, it may become even worse due to a substantial decrease in the number of candidates now coming out of the country’s colleges and universities. Even the best CPA firms are having trouble bringing new, younger talent on board.
The second top issue is really an extension of the first: succession planning. The issue is really two-fold: there isn’t enough new talent coming out of school to fill up the ranks and, as a result, many of today’s partners have serious doubts that what talent remains will be able to generate the kind of revenue needed to keep the firm afloat and pay their retirement benefits.
The third issue: pressure to increase revenues, maybe the one area where at least some CPAs are making good progress. Over the past several years, many CPA firms have turned to additional, value-added services to increase their source of revenue. Among those services are personal financial planning, wealth management and business valuation services.
Of those firms venturing into personal financial planning and wealth management, some have gone into asset management and charged fees related to assest under management, while others have gone into sales of products such as life insurance. It is the latter group that seems to be making the most headway.
By partnering with reputable financial services companies—sometimes as a joint venture, sometimes in a strategic alliance—CPAs cannot only recommend a course of action to their clients, but also take an active role in helping them carry it out—right down to the selection and purchase of underlying products.
Some CPAs have become licensed to sell insurance and securities. Others rely on referrals to their joint venture partners and some have brought individuals in-house in order to retain a degree of control over the entire process. Regardless of which method works best, the CPAs who have integrated financial services into their practices have not only seen increased revenue, but also an increase in their customer base.
If your firm is looking to establish partnership arrangements with financial service professionals, before you start, do your homework. Look for a company that’s been working with CPAs all along, one that has an established program designed to get you up and running in the least possible time and at the least possible expense. Look for a company that gives you access to advanced marketing attorneys, pension specialists and product specialists and offers comprehensive training programs geared to you.
The opportunities in financial services for today’s small, independent CPA are many, and those who are taking advantage of them are the ones who are remaining in control of their finances and future.
Securities can be offered solely by representatives registered to offer such products through a broker/dealer. Investment advisory services can be offered solely by investment adviser representatives through a registered investment adviser. The companies of National Life Group® and their representatives do not offer tax or legal advice. For advice concerning your own situation, please consult with your appropriate professional advisor.
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