Tax Time is a Great Time to Review

Senior couple with financial adviser.

couple with financial advisorEvery year, about 140 million households file their federal tax returns.  For many, the process involves digging through shoe boxes or manila folders full of receipts; gathering mortgage, retirement, and investment account statements; and relying on computer software to take advantage of every tax break the code permits.

Reviewing tax returns presents a great opportunity for adding value to the client-advisor relationship. Tax returns provide a tremendous amount of information about a client’s or a prospect’s financial situation, giving you the chance to identify planning opportunities and, to review what type of products they should consider when accumulating assets for their future.

Generally speaking, people fall into two categories: those who are dismayed by higher-than-anticipated tax liabilities and those who are pleasantly surprised by tax refunds. But whatever the situation, most wonder if they can do something different to reduce their tax burden now and in the future. Few clients or prospects will decline an offer to review their tax returns or evaluate their overall financial situation.

When establishing expectations for assessing a tax return, ask your client (or prospect) to mail or e-mail you a copy after he or she files. Then, schedule an annual review and use the tax return as a road map for exploring future strategies for his or her investment or financial plan. Through your careful attention, you’ll demonstrate your commitment to offering meaningful guidance and support. And, by and large, you will be the only advisor to invest this kind of time and interest in the client.

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