The emergence of cognitive computing, artificial intelligence, and blockchain within the finance industry has threatened accounting firm deliverables over the past few years. As technology begins to supersede the services of accounting professionals, accounting firms must find ways to adapt in order to continue being a valuable resource for their clients. A possible solution is for these firms to implement wealth management as a complement to the services they already offer.

Although a wealth management practice may not be the solution for all accounting firms, many firms have already decided to go in this direction in order to develop more client-specific business strategies and increase their profitability. However, it is important for accounting firms to gauge the advantages and disadvantages prior to integrating wealth management services in their practice. If wealth management is the right direction for an accounting firm to take, and it is implemented in a well-structured manner, firms can see substantial growth in their profitability from the accounting and advisory services they provide.  

Access To Multiple Services

Wealth management advisors tailor a customized financial strategy based on a client’s financial goals and current net worth. Through the implementation of a vast array of financial products and services, wealth management advisors offer a wider range of assistance than most accounting firms. From financial and investment advice to estate planning to retirement preparation, wealth management services provide clients with a more holistic strategy for managing their finances.

With wealth management client services, accounting firms are better positioned to be a more valuable resource for clients as the financial needs for clients continue to increase. Additionally, expanding your accounting firm’s arsenal of services can boost your client’s confidence that they will be taken care of regardless of the financial service they need. When it comes to the current state of accounting services, clients often must seek out different financial professionals based on the services they need; thus, broadening the range of services your accounting firm offers could potentially create a one-stop-shop that meets every service your client is looking for if executed properly.

Having expertise in not just offering the typical accounting solutions for clients, but also a knowledge-base in investment strategies, asset management, retirement income planning, and household budget management can drastically improve your accounting firm’s outreach for new clients and strengthen the relationship with the clients you currently hold.

Improving Client Experience

There is one clear reason for integrating wealth management client services in your accounting firm, and it is not for the accountants; it is because your clients need it. Far too often, accountants wait for clients to explicitly ask for wealth management services, which prevents them from being proactive and taking the initiative to provide these services in advance.

Firms will suffer if they fail to provide the services that their clients need. Accountants tend to specialize in one particular service, which is a narrow-minded approach that can damage future profitability as a client’s financial needs grow, but the services they offer do not. Therefore, an expansion into wealth management services allows accounting firms to cater to more financial goals clients are aspiring to achieve.

Moreover, the increase of automation and cognitive computing within the finance industry may diminish the services an actual professional in the field can provide. Accounting firms can take the initiative and actually use these technological advancements to their advantage if they are methodical in their approach. Those who elect to integrate both the technological and interpersonal sides of the financial advisors will be able to find much more success and increase profitability for their firm. This transition can be facilitated through integrating wealth management services, which tends to necessitate a more personable connection with clients.

How Can My Accounting Firm Implement Wealth Management Services

If your client already trusts their finances with you, odds are they will trust you to manage their money. There is a tremendous opportunity for accounting firms to better serve their clients by not just offering assistance for a client’s current financial standing, but also with what to do after. It is just as, if not more, important for clients to be assured that their finances are being managed properly and that they are more equipped for preparing for the future.

Accounting firms may be deterred to expand their operation out of fear or simply lack of knowledge for doing so, but these three easy steps can effectively ease any accounting firm’s transition into providing wealth management services:

1. Develop A Structure

Nothing could be accomplished without first establishing a plan. Developing a team that specializes in these new services you are looking to offer stands at the forefront of importance. Though accounting advisory and wealth management services share many similarities, it is vital to have someone who specializes in the various nuances within these areas on your team. For example, having a CPA partner working part-time on the wealth management portion of your business is not recommended, you want someone who is completely committed to the sector and has a strong background in how to provide wealth management services. This allows the client to receive 100% of the focus from their advisor as well as have a team that meets their exact financial needs.

2. Build Trust

Sometimes it can be difficult to maintain trust with clients when you tell them they are going to be charged with another form of service. A client’s trust is the most important thing for an accounting firm to sustain, and it can be preserved during this transitional period with a transparent and ethical approach. First, ensure to your client that you have done your due diligence in finding the right people to provide wealth management services. This can be accomplished by requiring financial advisors to have an extensive background in wealth management, they are CFP certified, and they understand the philosophy of your accounting firm.

3. Justify Fees

Introducing new fees to clients can be a major deterrent for clients who aren’t looking to sacrifice more of their money to receive financial assistance. Additionally, many wealth managers often can get caught up in their commissions they receive, which may impede their fiduciary responsibilities. While it is vital to create a team that understands wealth management services, it is just as important to have people who know exactly how to value the services they provide. Taking the time to explain to your clients the worth of these services is crucial for justifying why your client needs this assistance at minimum cost to their own pockets.

Take Action

Though some accounting firms have already taken the initiative to offer wealth management services, there is still an untapped opportunity for more accounting firms to do so, as well as for those who already have to go full-press. With more accounting services becoming automated, it is vital for firms to take action and prepare for the future by providing resources to clients that simply can’t be replaced by technology.