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Accountant or Planner – which do I need?

11 December 2017

Money & Life team

Money & Life contributors draw on their diverse range of experience to present you with insights and guidance that will help you manage your financial wellbeing, achieve your lifestyle goals and plan for your financial future.

When it comes to sorting out money matters, where do you go to seek professional help? Can an accountant take care of your finances or should you be speaking to a financial planner? Discover more about the difference between these two support services and how you can benefit from both.

Seeing an accountant is something that’s routine for most Australians. After all, lodging a tax return is mandatory, except in a few unusual circumstances. And if you’re a business owner or self-employed, services from your accountant are something you’ll rely on even more. But when it comes to working towards a better future for your finances, which expert should you turn to?

We spoke to Richard Felice, CERTIFIED FINANCIAL PLANNER® professional and Managing Director at countplus one, about how working with both an accountant and financial planner could be just what you need to get your finances in the best of shape.

When it comes to managing money day-to-day, is an accountant best qualified to provide advice? 

Generally, people are going to spend time with an accountant to stay on top of their tax. And if you’re a small business owner, you’ll be particularly reliant on the advice from your accountant to ensure you have the right support for your operations. Financial planning, on the other hand, has traditionally been seen as something you only get around to when retirement is closing fast.  But it can be much more than that. A planner will help you understand your financial situation at any life stage, develop a strategy and give guidance on things like funding your children’s education, helping with budgeting, saving, investing and putting in place the right insurances.

Your accountant is certainly going to be the right person to keep the ATO from breathing down your neck and their wisdom can do wonders for the P&L, balance sheet and growth of your business. While an accountant may be best qualified to explore how you could be more tax-efficient, a planner has a role to play here too. And when it comes to personal goals and how they relate to our finances, there’s much more scope to get you on track with an accountant and planner both involved. Working together they can look at your overall financial position and what you can be doing to improve it, now and in the future.

Can you give examples of situations when you might benefit most from seeking financial advice?

By the time you’re within 5 years of finishing work for good, you could well have missed the window for being really effective in preparing for retirement. Whether it’s to maximise your super contributions or tax advantages, waiting until retirement is just around the corner can mean fewer opportunities to benefit from current legislation and saving more for later in life. Having said that, you can still make discoveries and take action at any stage that can have a positive impact on your financial situation and lifestyle goals in retirement.

Getting a head start on preparing for retirement is just one example of how financial planning can really open your eyes to what’s possible with your current income, debts and wealth. It’s really a case of “you don’t know what you don’t know” and the same can be said for accounting too. As accountants, it’s our job to make sure you manage your assets and liabilities in a way that will see you better off, both in terms of tax efficiency and cash flow. As financial planners, we help you to prioritise to be more effective in managing your budget, saving, settling debts and investing, all based on a thorough understanding of what you want to achieve.

So whether you’re starting a family or a business, buying a home, changing careers or inheriting money, your accountant and financial planner are both allies who can reveal options you might not be aware of and guide you towards better choices for the future. It’s about forming a partnership to truly understand your goals and using expertise to give you new strategies, tools and opportunities for aligning what you do with your money with those goals. And that’s a partnership that can bring you peace of mind that you’re doing all you can to manage your money and live well.

How does a financial planner work to add more value to your overall financial position?

There seems to be a common misconception that financial planners are investment specialists, first and foremost.  We do have very important knowledge and experience when it comes to investment strategies – particularly recommending an approach to asset allocation that makes sense with the desired timeframe and level of risk for the amount you’re investing. But how we’re really adding value is in treating that investment approach as just one part of a larger strategy designed to meet all your financial needs.

Of course it’s important to have any savings or assets working hard to bring you more wealth. But a financial plan is also about other, more complex lifestyle goals – such as making sure children are provided for or creating an opportunity to follow a new career path. Taking a holistic approach to your future needs is how a financial planner really adds value with their knowledge and advice.

What are the benefits of having a planner and accountant who can work together on your behalf?

When both professions – accountants and financial planners – operate at their very best, then you’re getting holistic advice that’s carefully researched and focussed on your goals. We’re finding more accountants are focussing time and resources into what the future looks like for their clients as opposed to making the best of what’s gone before. This is an approach that’s really driving the business forward here at countplus one.  Because when you have a really top drawer financial planner and accountant, both taking time to understand you and communicate with you – and each other – about what’s needed to prepare for your best future, you’re really going to be on the front foot in all your financial affairs.

There are a couple of situations where having a strong planner/accountant team can be particularly helpful.  For small to medium enterprises (SME’s), it’s often the case that they’re very reliant on a good accountant for their business to support its growth. And there’s a tendency to be channelling all your resources – personal and financial – into the business.  It’s only when you’re ready to realise the value in your business, usually through a sale or succession plan, that you start thinking about planning for your personal financial future. With a financial planner and accountant on board, you can be giving the business what it needs to thrive, without placing as many limits on your own finances and lifestyle, now and in the future too.

An accountant/planner partnership can also come into its own for your self-managed super fund (SMSF). Although accountants can run the administrative side, few are qualified to offer advice on ensuring SMSF investments are aligned with your goals. So we’re seeing a real convergence between accounting and financial planning professionals to provide a complete SMSF management, advice and administration service.

Still not sure just how a CERTIFIED FINANCIAL PLANNER® professional could help you? Discover 5 key life events and situations where financial advice can make difference to your future wealth and success.