Why financial planning and accounting go hand-in-hand and how your clients could benefit

People discussing finances

Providing a joined-up service to clients when it comes to their finances can improve outcomes. It’s why many larger accountancy practices retain an in-house financial planner – this sort of holistic approach can ensure clients benefit from high-quality advice under one roof.

Developing a relationship with a trusted professional can offer the same benefits. Clients are increasingly seeking integrated advice that takes into account all aspects of their financial affairs. This can be particularly true if wealth is tied up in a family-owned business.

Clients don’t want to spend time going from one adviser or accountant to another. They want to work with a team of specialists, all rowing in the same direction and helping them to achieve their outcomes.

3 reasons why your practice may not want to provide financial advice

There are many reasons why your accountancy practice may not want to provide financial advice to clients:

  • The increasing regulatory burden
  • The increase in professional indemnity (PI) premiums
  • Diluting a service rather than focusing on the key areas that generate higher fees (audits, payroll, selling a business and so on).

Consequently, you may be seeking to establish a relationship with a trusted local firm who can work closely with you to provide the protection, pension, investing and saving advice that your clients need – especially those with complex financial affairs.

Of course, taking this step comes with risk.

When any professional firm refers clients to another, you are putting your personal reputation on the line.

While the client relationship can be enhanced by great quality service and advice from a fellow adviser, the reverse is also true. We’ve seen instances where our relationship with a client has been damaged by poor service from a third-party firm we’ve recommended them to.

Consumer Duty has raised the bar for service

When considering recommending your clients to a financial planner, you’ll likely want to undertake thorough due diligence. For the reasons above, protecting your reputation and aligning with a firm that offers the same level of service is critical.

The introduction of Consumer Duty has thrown this issue into sharper focus. The Financial Conduct Authority (FCA) has set higher and clearer standards of consumer protection across financial services and requires firms to put their customers’ needs first.

As the need to achieve the best possible client outcome is under greater regulatory scrutiny, it’s more important that both parties work closely than ever.

One notable way that you can shortlist potential partner firms is by looking for a Chartered practice.

Chartered status is the “gold standard” of financial planning and positions firms amongst the UK’s leading practices.

To secure Chartered status, firms must demonstrate:

  • The highest levels of technical knowledge through professional qualifications
  • A commitment to the ongoing development of our skills and knowledge
  • An adherence to high moral and ethical standards.

By working with a firm of Chartered planners, you can be confident that you will receive the best possible advice, service and support.

A fresh perspective and option

One of the reasons that working with a fellow professional can lead to better outcomes for your client is that they benefit from an independent perspective.

Consider the example of one of your business owner clients with who you have an established relationship. A financial planner meeting the client for the first time will add value by bringing a fresh and objective opinion to the table.

There may be financial planning solutions that enhance a client’s overall position, complementing the tax or business advice you provide.

The alternative is to treat accounting and financial planning as separate disciplines, with the result that clients can sometimes receive conflicting advice, albeit inadvertently.

Working together can ensure that your client’s wealth remains within the family. Additionally, they will also benefit from the best possible advice on issues including:

  • Personal and corporate protection
  • Tax planning
  • Pensions and retirement planning
  • Wills, trusts and estate planning
  • Tax-efficient savings and investments
  • Mortgages
  • The business exit strategy.

A really simple example of the synergies that exist within accountancy and financial planning is in remuneration planning – how best to structure a client’s income, mitigate tax, and maximise take-home pay.

When compared to dividends or salary, funding pensions may be a beneficial option. Accountants can really demonstrate their worth by helping clients find this compromise point, while financial planners can give specific pension and retirement advice.

Get in touch

As a Chartered firm, we have wide experience working with the clients of accountancy practices to provide a holistic, joined-up approach for clients.

So, if your clients would like to benefit from the reassurance and peace of mind of working with a Chartered expert, we can help. Please email or call 01454 416653.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

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