Early in 2016, I heard tax icon Sid Kess speak about how important it is for CPAs to understand what housing alternatives our clients might need to consider as they grow older. I thought, well that’s an interesting aspect of our work that I hadn’t considered, and began to educate myself about the options and opportunities in the communities I serve.
That advice couldn’t have come too soon: within a month, my dad began expressing concerns about taking care of his home and asked to look at some local housing alternatives. While I had made myself aware of a few, I quickly realized there are so many choices that I didn’t have time to explore them all. Unfortunately, my father’s health declined rapidly and we had to move him three times: from his home to senior living; from senior living to a nursing home; and from the nursing home to hospice care where he passed away.
What this really brought home is that the work we do as CPAs is not cut and dried, and goes beyond what many people envision when they think of our profession. It’s probably also more than many budding CPAs—and those long in the profession—think we do. But the fact is that we must continue to deepen our knowledge and expertise as our clients’ needs expand and grow.
Continue reading "What the Personal Financial Planning Body of Knowledge Means for You" »
Put powerful emotions in the same cauldron as money and you get a volatile and highly flammable mix. If your clients need one reason to involve a trusted CPA in their divorce process, that argument is as strong as it gets. As a financial professional, you have likely seen first-hand that divorce has the potential to uproot the financial stability of your clients (see more in this latest trend survey released by the AICPA Personal Financial Planning Section). If splitting the family possessions and bank accounts weren’t complex enough, there is also Social Security and Medicare to consider.
By asking the right questions, CPAs can steer their divorcing clients around pitfalls and help them make smart choices that maximize their financial outcomes.
Continue reading "Social Security and Divorce: What Clients Need to Know" »
The face of America is showing its age: According to the National Institute on Aging, the number of Americans age 65 and older is expected to double in the next 25 years, with those 85 and older constituting the fastest-growing segment of the U.S. population. These Americans are increasingly becoming targets for elder financial abuse.
Extent of the Problem
The phenomenon of elder financial abuse is not new. But today, increasingly sophisticated tactics are being used with significantly higher stakes. Assets totaling approximately $23 trillion are the target.
The National Adult Protective Services Association (NAPSA) reports that the rate of elder financial abuse is extremely high, affecting 1 in 20 older adults. However, at the same time, only 1 in 44 cases of elder financial abuse is reported. The greatest number of reported abuses were perpetuated by family or others known to the victim.
Continue reading "Elder Financial Abuse: How CPAs Can Help – Part 3" »
Are you wondering if all of your clients should complete the Free Application for Federal Student Aid (FAFSA) for their college-aged children even if they don’t anticipate qualifying for any federal aid?
Consider the following scenario: A successful couple own and operate a business and have two children in college. At 58 years old, the husband suddenly and unexpectedly passes away from a heart attack, rocking the family and ending the business.
The family, however, had faithfully completed the FAFSA annually for their children, although they had never previously qualified for financial aid. Within one week of the death of the father, both universities contacted the children with financial aid packages that allowed them to stay in school.
Continue reading "3 Reasons Every Client Should Complete a FAFSA" »
With a rapidly aging population, more people will turn to their CPA in the coming years as a trusted source of guidance, especially when making senior living decisions. A popular, but also rather complex choice is the continuing care retirement community (CCRC or “life plan community”).
By combining independent living with a continuum of care, CCRCs offer a viable solution for older adults who are healthy today but seek the peace of mind of having care services readily available in the future. Your client’s specific needs will likely determine which CCRC is best for them. There is no “one size fits all” approach here. Yet, due to the financially significant nature of the CCRC decision, it is important to make sure their first choice is the right choice, so you owe it to them to be well-educated and informed on this topic.
Continue reading "Continuing Care Retirement Communities: Helping Clients Choose" »
“Consider your story as you craft your goals.”
Not your typical soundbites from a gathering of CPAs.
When I leave an AICPA conference, I always bring home the best technical thinking in the profession and new and deepened relationships with peers across the country. This content and camaraderie is what brings me back year after year to these events.
As I gathered my thoughts after the recent AICPA Personal Financial Planning Summit, I noticed a shift in the tone of the key takeaways that I was anxious to implement in my firm. This innovative and intimate event sparked new thinking about how I – and other CPAs and planners who serve individual clients with their tax, estate, retirement, risk management and investment needs – can shape our practices for the future. Here are four challenges and some questions to consider from this year’s summit:
Continue reading "4 Ways to Move Toward Practice Transformation" »
In our first blog post of this series, we looked at three typical examples of elder financial abuse and some of the reasons why seniors are attractive targets. Helping safeguard your clients from financial abuse as they age, or experience a serious health problem, is one of the most important and meaningful things you can do for them. In this article, we will delve deeper into types and signs of financial elder abuse, and ways to prevent it before it starts.
Continue reading "Elder Financial Abuse: How CPAs Can Help – Part 2" »
Scenario 1: Your usually chatty elderly client Nancy has become quiet and refuses to speak with you without her son Chris present. When they come in together, she is timid and acts nervous, while he is combative and secretive about sharing bank statements and other financial information. When you insist, you see discrepancies and unusual cash withdrawals, or other activity that he claims are for “household expenses, which are none of your business”.
Continue reading "Elder Financial Abuse: How CPAs Can Help – Part 1" »
I recently had the privilege of speaking on financial planning to 150 CPAs at a Washington Society of CPAs conference. I began my remarks by asking how many in the audience considered themselves financial planners. Only two raised their hands.
That surprised me. I know that many CPAs help clients with some aspect of financial planning, from tax, retirement and estate planning to succession planning and wealth management. And, frankly, who better to help clients negotiate their financial futures than CPAs? Clients already rely on us to provide trusted advice on other financial matters.
The sparse response got me thinking back about my own experience coming to terms with the term “CPA financial planner.”
Continue reading "What’s in a Name?" »
I once attended a workshop in which an established adviser shared a story from a conversation he’d had with one of his clients. The client was a young, affluent widow who decided she wanted to fulfill a lifelong dream to buy a condominium in her favorite city in Europe. While she could well afford the $2 million price tag, something was keeping her from pulling the trigger.
The adviser asked, "What is it that is really bothering you about this purchase?" After some deeper probing, she finally shared her issue: "It's just that I keep hearing my mother's voice in my head." (Her mother had died many years ago).
"And what is your mother saying?" he asked.
"She is saying that I am being frivolous with my money."
Continue reading "Leave Yourself Behind When Working With Clients" »
You might have noticed the “graying” of your clients and thought “how can I, as a CPA and trusted adviser, provide services that meet their changing needs? What are the practice considerations surrounding those services?”
Recently, we served on a panel at the AICPA Conference on Tax Strategies for the High-Income Individual that focused specifically on these issues. Consider some of the following ideas gleaned from the session and how you may be able to incorporate them into your practice:
- Services: Cognitive challenges often affect executive functioning, such as the ability to handle day-to-day finances. Services you might offer include automating finances such as bill paying, monitoring investments, and reviewing banking records to identify elder financial abuse. With clients more commonly living into their 90s and beyond, budgeting and the recurring financial responsibilities of an individual or family take on a very different nature.
Continue reading "6 Planning Ideas for CPAs Who Have Aging Clients" »