Thursday, March 17, 2022
HomeAccountingArt of Accounting: Cashing in with trillions of future wealth

Art of Accounting: Cashing in with trillions of future wealth



In the next generation, trillions of dollars will be transferred and accountants can cash in if they are prepared. Many accountants tell me they see no future for small firms. Boy, are they way off the mark. Small-firm owners and partners are in the best position to advise their clients on the giving, holding and receiving of this wealth because they are the closest advisors in all respects to their clients.

I know a lot of accountants who want to grow their practices, and many who are happy where they are. Those that are happy, good for you; most of those that want to grow are also happy, but they are looking for added ways of being happy. Here are some suggestions:

  1. Many clients have IRAs, Roth IRAs, 401(k)s and similar retirement accounts with trillions in them. I did a quick search to see how much is in IRA accounts, and $19 trillion came up (and there is a lot more when you add in all of the other types of retirement accounts). These funds need to be invested, managed, withdrawn and inherited. Further, designations of beneficiaries need to be made and the consequences of the choices need to be explained. You can also integrate charity planning into this and a bunch of other planning tactics. This is important stuff.
  2. Social Security is not an asset, but it is a source of retirement cash flow for all our clients. Timing the start and coordinating it with other cash flow sources needs focused planning, and this needs to consider all of the client’s financial affairs. There is a big opportunity here for accountants who are the advisors who are most familiar with our client’s affairs.
  3. Personal savings also are in play and clients need integrated guidance. Who better than us?
  4. Many accountants are adding asset management and this is a fast-growing part of their practices. 
  5. Debt management is another area that needs to be discussed with clients. I know from experience that it is not as lucrative as working with clients who are not in debt, but it is still an essential service we can provide.
  6. Huge inheritances can be expected by many clients and the planning, administration and management of these will need a capable and trusted advisor. 
  7. With wealth, income tax planning becomes more crucial and involved. Maybe not overly complicated, but still it will need attention that hasn’t been previously necessary. 
  8. Many clients do not consider themselves philanthropists, but give meaningful amounts to charity. Add some extra money to the pot, and some planning might put them on the right track of what to do to accomplish some of their goals.
  9. With all this wealth and expected wealth, clients will need estate planning. Perhaps not estate tax planning, but estate planning. Accountants are ideally positioned for this. We are available, knowledgeable and intimately familiar with our clients’ affairs and family relationships. Of course, we can also assist in estate tax planning.
  10. Tying everything together is a valuable service, even if nothing specific is recommended. Part of our value is keeping track of things for our clients and making sure nothing falls through the cracks. We can suggest when specialists should be engaged, then coordinate all of this and present it in a cohesive manner to the client. In football parlance, we would be the quarterbacks.

There is a lot more we could do and the above is just a brief listing. There are also many ways of offering these services, including using an all-inclusive engagement subscription model. There is also a lot to learn to be able to provide these services, but you have the time, just as our clients have the time until they cash in, in one form or another. The work is there for the taking; the value is immense to the clients; and you are ideally positioned, so get started.
My updated 2022 Tax Season, Practice Management, and Getting Your Affairs in Order checklists are available among 153 checklists. Email a request to GoodiesFromEd@withum.com. Just put Updated Checklists as the subject.

Do not hesitate to contact me at emendlowitz@withum.com with your practice management questions or about engagements you might not be able to perform.



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