The Financial Planning A-Team Includes Your Tax Advisor

By Caleb Arringdale,Tax Advisor

Some believe that the financial planning industry is unnecessary and choose to follow a few common-sense aphorisms like “Spend less than you earn”. However, good financial planning includes so much more than the basic “earnings vs savings” question. Great financial planning involves a holistic approach from a team of financial and tax professionals. Much of the work is truly counterintuitive, and some of it is just plain complicated.

While everyone knows it’s important to save for retirement, the best way to go about it is often extremely complicated. It usually includes a combination of tax law, government regulations, and good savings habits. Navigating this complicated environment often requires your financial planner and tax advisor to work together to make the best decision for each client.

Example of your financial and tax professional working together

Let’s say a client needs $10k and has several different types of investment accounts. The financial planner might suggest selling stock to quickly provide $10k for the client. However, the best tax approach might be to pull funds from a Roth IRA. Combining your financial planner and tax advisor can result in the best plan for the client thanks to their combined expertise.

Taxes should not be the main concern when making financial decisions. If a client wants to pull money for a family vacation or their dream car, the fact that it will probably increase their taxes should not be the deciding factor. However, their tax advisor can work with their financial planner to figure out the best possible way to achieve the desired outcome.

In financial planning, we often think about the difference a few percentage points can make. The same is true of tax planning. Proper planning that includes both financial and tax considerations can add to the growth of your assets, ensuring the best possible use of your funds.

At The Planning Center, our clients have the benefit of integrated tax professionals that work directly with their financial planners. If you would like to learn more about TPC’s comprehensive financial planning process with integrated tax, schedule a free consultation



Caleb Arringdale is a Tax Advisor in the Quad Cities office of The Planning Center, a fee-only financial planning and wealth management firm.

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