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The Benefits Of Adding Comprehensive Financial Planning To A CPA Practice

As a CPA, you provide valuable services to your clients. They trust you with their finances and lean on you to make sure they are optimizing their tax-saving opportunities. But taxes don’t exist in a bubble. Your clients’ financial lives include many aspects that would also benefit from expanding their relationship with their trusted CPA.

Given the competition you’re already facing from online tax preparation companies, why not do this one thing to bring more people to your door: offer comprehensive financial planning. Only one 3-hour securities exam is required to include investment planning, insurance planning, and a broad array of wealth management services.

It Increases Client Satisfaction

Adding financial planning as well as access to investment management services benefits your clients by offering the convenience of a one-stop solution: comprehensive financial planning and objective wealth management. Not only is a more satisfied client more likely to continue doing business with you, but they are also more likely to refer their friends and colleagues. As client satisfaction increases, so does client retention and referrals.

For example, let’s look at estate planning. Clients want to minimize taxes and expenses in their estate plan, yes, but they also want to make sure their legacy is protected and the estate plan is carried out properly. They shouldn’t have to go to multiple professionals to make this happen. No matter what their financial needs are, comprehensive services will help them achieve a cohesive financial plan and align the various parts of their financial life. 

It Sets You Apart

In today’s fast-paced world, everyone is seeking to simplify their lives and save time. Why would a client want to go to a CPA and a financial advisor if they can get the same services all in one place through someone they already know and trust? Your clients are more likely to access wealth management services from you because you have already gained their trust and proven yourself. Studies show that clients tend to avoid sales organizations or brokerage firms and desire a relationship with a fee-only fiduciary.

Offering wealth management services to your clients diversifies your practice, giving it a competitive advantage. In a sea of CPA firms, one that offers wealth management services in addition to taxes, accounting, and auditing is likely to attract the attention of more prospective clients.

It’s A Way To “Future-Proof” Your Practice And Enhance Valuations

Where will your practice be in two years? Five years? Today, you may be unsure of the value you will receive when you eventually sell your firm. Perhaps you’re considering working indefinitely to maintain your family’s standard of living. Most CPAs do not have any succession plan in place and are apprehensive about their exit strategy and their family’s well-being. 

Today, the average CPA is over 50 years old, meaning that they are inching closer to retirement age. (1) However, with only $220,000 saved for retirement on average, many CPAs are depending on the sale of their firm to fund their retirement. (2)

Data shows that the average CPA firm sells for about one multiple of gross annual billings. (3) If your average billing is $500,000, the invested proceeds only translate into $16,000 per year in retirement, using the rule of 4%. What other options are available to increase income in retirement and the sale value of your firm?

It Increases Your Recurring Revenue

This is probably what you’re most curious about: Will adding wealth management services add to the financial success and longevity of my firm? Let’s look at the numbers to find out. 

CPAs who added wealth management services to their firm shared that they saw an increase of 20% in billing and increased sales of 200-250%. Not to mention a recurring (and growing) income stream from managing assets. (4) Some estimates even put the annual figure at $1-3 million annually for every $10 million in accounting revenue. (5) Simply put, offering more services adds value, allowing you to increase billings. This grows your revenue per client, which improves the profitability of your firm as a whole.

And, as you add accounting clients, you have an in-house referral for wealth management services, and vice versa. This automatically provides you with an opportunity for increased income with every client that works with you. The good news is that it is much easier to add comprehensive financial planning as well as wealth management services than you might think. 

How To Start The Process

If this sounds intriguing to you, start by initiating a discovery process. Survey your clients to find out their financial stress spots, analyzing their financial situation as a whole, and digging up the gaps in their planning. You are also in the perfect position to see where other advisors are falling short, such as high fees or poor performance. This will help you decide how to serve them best and enhance your firm’s offerings. Prioritize your relationships, since this is what will bring people to you in an oversaturated financial services market. There are plenty of people who can offer what you do, but it’s the relationship they have with you that will drive your success. 

Finally, build a strategic partnership with the right wealth manager, whether you wish to associate as an Investment Advisor Representative (IAR) or you simply need a proven wealth manager for professional referrals. ClientFirst Wealth Management is a fee-only Registered Investment Advisor (RIA) and fiduciary, with over 90% client retention and exceptional service, always provided by a CFP® professional. We recently made the investor.com 2020 Top Financial Advisor Firms in Arkansas list! We manage over $140 million for Arkansans and have many resource partners, including Charles Schwab, Vanguard, JP Morgan, and Raymond James, among others. 

We would love to partner with you and increase the profitability of your practice while also enhancing your client experience. Our wealth management fees are very competitive and are billed quarterly, in arrears. Our referral partners receive 35-40% of gross revenue. Our IAR partners receive 50-70% of gross revenue.

If you want to learn more about how a partnership with ClientFirst Wealth Management can make a difference for your firm, contact me, ClientFirst founder Ed Mahaffy, at (501) 603-0406 or ed@clientfirstwm.com.

About Edward P. Mahaffy, MBA, CFP®, ChFC®

Ed founded ClientFirst Wealth Management in 2007, after more than 23 years in the wealth management industry. Prior to launching ClientFirst, he spent 6 years as a portfolio manager and branch manager with Raymond James, 6 years as a vice president and portfolio manager with Merrill Lynch, and over 11 years as a financial advisor and fixed-income portfolio manager with Stephens, Inc. 

Designated as a Certified Financial Planner and Chartered Financial Consultant, Ed holds a Bachelor of Science in Business Administration from The Citadel and earned his MBA from the University of Arkansas. He is also a member of the Financial Planning Association (FPA). Ed has had articles published in The Arkansas Banker as well as Barron’s magazine and is a member of the National Association of Personal Financial Advisors (NAPFA). He is also the author of How to Select a Financial Advisor: The Least You Should Know.At ClientFirst, Ed is president and senior portfolio manager. 


The views expressed represent the opinions of ClientFirst Wealth Management, LLC (“ClientFirst”) and are subject to change. These views are not intended as a forecast, a guarantee of future results, investment recommendation, or an offer to buy or sell any securities. The information provided is of a general nature and should not be construed as investment advice or to provide any investment, tax, financial or legal advice or service to any person. 

Additional information, including management fees and expenses, is provided on ClientFirst’s Form ADV Part 2, which is available at https://adviserinfo.sec.gov/firm/summary/120286.


(1) https://www.cpajournal.com/2017/12/15/the-state-of-the-profession-2/

(2) http://static.fmgsuite.com/media/documents/a2e9a9e1-fa23-44d4-9c81-b7444da6f2d1.pdf

(3) http://www.accountingpracticesales.com/buyers/info/one-times-gross-is-that-the-law

(4) http://static.fmgsuite.com/media/documents/a2e9a9e1-fa23-44d4-9c81-b7444da6f2d1.pdf

(5) https://www.fa-mag.com/news/we-ve-also-got-wealth-management-54780.html?section=47

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