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What You'll Learn In Today's Episode
  • When meeting with a prospect, remember that providing advisory value is an ongoing process. The benefits from shrewdest-ever tax planning aren’t always evident over one year. Therefore, convey the larger, long-game picture.
  • Steven frequently says “Get tax returns every year” because it’s important: You’re a financial doctor and a tax return’s numbers are prospects/clients’ pulse and blood pressure. Get a copy of it ASAP. You need it to truly understand their individual situation.
  • Whenever possible, get a copy of the prospect’s return ahead of meeting with them. Familiarity is always better than a cold read. Give them a glimpse of what their future could look like. A little free value, initially may prove irresistible.
  • Before the meeting takes place, rehearse out loud how you’ll present the various possible scenarios. Don’t try to do all the math in your head. At the same time, be familiar with the numbers involved. If you’re relaxed, odds are that the client to-be will relax, too.

Welcome back to the Retirement Tax Services Podcast! It’s Tax Q&A Friday and Steven has another user-submitted question. An advisor asks about the prospect-meeting process: What are some simple ways to quantify the impact of tax planning or different tax strategies?

The simplest answer may be “Look at it over time.” It is an ongoing process. As a result, the benefits from shrewdest-ever tax planning aren’t always evident over one year.

Quantify: Explain the Long Gain

Like exercise, tax planning’s results rarely wow anyone on their first day. Similarly, the longer you stay at it, the more benefits you’ll see accumulate.

Most of the value is derived by sanding the rough edges off annual tax bills. So, start by mentioning how money is saved over years of time.

Don’t just say, “We helped you max your HSA contributions this year.” Instead, look at what those savings will be over 5 years. Next, look at the projection for 10 years down the road and so on.

The dollar amounts begin small, but increase over time. Likewise, Roth conversions aren’t usually a one-and-done service. Multiple are made over most clients’ lifetimes.

Remember that taxes, like money, are emotional. Don’t try to decide which amount of savings is important. In other words, let the client judge what means the most.

Ask for a copy of the prospect’s tax return. You cannot provide serious value to the client without it. As a result, Steven regularly mentions getting it.

If you’re a financial doctor, the tax return’s numbers are clients’ pulse and blood pressure: It’s impossible to know what’s really going on in their specific situation without them.

With the prospect’s return in-hand, you can explain potential strategies using concrete specifics. In other words, you can estimate what your tax plan will look like for them.

For this reason, request a copy of the return ahead of the meeting. Even a little familiarity will come across better than a cold read. Bring a little value, even if they haven’t officially signed on. Give them a glimpse of what their future could look like.

Don’t worry if the first meeting is the soonest that you can get it. However, always grab it ahead of time when you can.

Prepare to Present

In fact, practice your presentation a bit beforehand. Whether your test audience is a mirror or a team member, rehearse out loud how you’ll present the client’s various tax planning scenarios.

Don’t try to do all the math in your head. At the same time, be familiar with the numbers involved. The services of an obviously unprepared advisor make a tough sell.

The more comfortable you are, the better you come across on their end. If you’re relaxed rather than preoccupied, odds are that the client to-be will relax, too.

Brush up on your whiteboard skills, as well. Steven’s given examples in the past of some easy ways to deftly articulate tax topics and strategies. You don’t need an Art degree to pull them off smoothly, either.

Your Action Items

  • When you recommend tax strategies to a prospect or client, quantify the potential tax savings over time. Don’t just show them a single year. The bigger the picture, the clearer the value for them.
  • Practice explaining your most commonly-recommended strategies. Rehearse discussing those niche tax planning maneuvers before meetings. Use a mirror, a team member, or both. Don’t try to memorize it all, but get comfortable.
  • Leave Retirement Tax Services a 5-star review wherever you get your podcasts (please). Your feedback helps us grow. That, in turn, helps us deliver more value back to you.
  • Send feedback to Steven at Questions, like constructive criticism, are always appreciated. Send unusual tales of tax planning, too: you might get invited to share yours on the show.

Steven discusses quantifying value to prospects further in this Retirement Tax Services Podcast. 

Thank you for listening.


Steven Jarvis:

Hello everyone! Welcome to the next episode of the Retirement Tax Services Podcast: Financial Professionals Edition. I’m your host, Steven Jarvis, CPA. And in this show, I teach financial advisors how to deliver massive value to their clients through retirement tax planning. Now, today being Friday, we’re back to another tax Q&A Friday edition of the show. And today’s question is certainly on a theme that we’ve talked about before, but I think it’s valuable and worth revisiting. The question from an advisor who listens to our podcast is – during the prospect meeting process, what are some simple and impactful ways to quantify the impact of tax planning or different tax strategies? Which I love this question because there’s certainly a lot that we do both in financial planning, as well as tax planning that’s qualitative, helping reduce the pain, the anxiety, that confusion. But what’s so great about tax planning is there are a lot of things we can do to attach dollar savings to the strategies we can work with clients to implement.

Importance Of Long-Term Calculations [01:41]

So, one of the most critical things I think in answering this question that can consistently be applied is to make sure that you’re doing the math on multiple years of tax savings instead of just one. No, this isn’t going to apply for every tax planning strategy, but as we talk about on this podcast, most of the time where we can get a lot of value through tax planning is by doing this over time. By looking at multiple years and kind of sanding off those rough edges from a client’s tax bill. And so instead of saying, taking a really simple example, instead of saying, ‘okay, if we max your HSA contributions this year, we’ll save a thousand dollars in taxes’ or whatever it might be. Look at what those savings would be over 10 years or 5 years, or whatever seems relevant. But when we start doing it over time, which is how you’re going to work with your clients, you’re not just going to make these recommendations once and only do it for a single year, quantify for them. ‘Okay, here’s what this looks like over time.’ So, whether that’s HSA contributions or talking about doing Roth conversions, very rarely are you going to do a single Roth conversion and never revisit it again. Other things we’ve talked about on the podcast, like potentially implementing the Augusta rule or working with small business owners on things like cost segregation studies, or helping them identify how much they can take for a home office deduction. The impact in a single year might seem small, but multiply that impact over 10 years and you start to get to larger dollar amounts. You also have to keep in mind that taxes are very emotional for all of us, and so even if the dollar amount seems small, it can be impactful for your clients, for prospects, and you shouldn’t make that judgment for them of what dollar amount is going to be impactful.

Several weeks ago now, when Matt Jarvis was on the show with me talking about a mistake that had happened in reporting on a 1040, that was really a day of qualified charitable distributions, but ultimately the tax impact on the client was just a couple hundred bucks. But it just illustrates that you shouldn’t be making that determination for your client or on behalf of your client of what dollar amount is going to be material to them. So, being able to take the time to quantify these strategies, especially for a prospect is really going to be most impactful if you are getting the prospect’s tax return so that you can make your estimate of what that quantification looks like, as specific to their situation as possible. Instead of just talking in general terms of, ‘oh, we could do a Roth conversion’ or, you know, ‘we can look at maxing out tax preferred retirement accounts or health savings accounts’, having their actual tax return and ideally getting it ahead of time so we have a chance to look at it are going to be great ways for you to really maximize what you can quantify for your prospect, potentially even in that first meeting. So like I said, depending on your process for meeting with prospects, it could be that you’re getting a tax return ahead of the first meeting, or if you have an initial meeting and then follow-up meetings, if you have a multi-step process for onboarding new clients and potentially converting prospects, maybe that’s in a subsequent meeting, but having the actual tax return is really going to help you be able to quantify those tax savings. So like I said, that’s the single biggest one that’s really going to help illustrate that to your clients.

The Power of Practice [05:00]

The other thing that’ll make a difference is really going through and practicing for yourself out right loud with whether it’s looking at a mirror or with a member of your team, what these different scenarios can look like. So that you’re really comfortable with the numbers. Not that you have to be able to do all the math in your head, but you know, we’ve talked on the podcast before about whiteboard ideas and, you know, things that you can quickly illustrate for your clients or prospects to demonstrate how, not just how things work conceptually, but the dollar amounts that go behind them. So the more you practice that, the easier it’s going to be, the more comfortable you’re going to feel when you get up in front of a prospect and say, okay, great. Since this tax strategy has come up, let’s talk about what that might mean for you in your situation.

Action Items [05:45]

So for today’s purposes, I’m really going to leave it at those two things. And we’ll turn those into our action items. Of when you are recommending tax planning strategies, whether that’s to a prospect or a client, really, you owe this to either to make sure it’s clear to them the benefit of implementing a tax strategy.

But the action item is making sure that you’re quantifying the potential tax savings and that you’re doing it over a period of time, not just for a single year. So that they’re seeing that value. That really reinforces the value of working with you as a financial professional in general, that they’re not coming to you for this one-time consultation to go off and do this on their own. You’re reinforcing the value of consistent action over time.

The other action item being to practice, how you quantify and explain the most common strategies that you use with your clients and prospects, depending on the niche that you serve. Of course, I always love to throw in there as an action item to go out and leave us a five-star review wherever you get your podcasts so we know that this is providing value. You’re welcome to send feedback and questions for future Tax Q&A Friday episodes to,  we love hearing your questions and having a chance to answer them here. Until next time, good luck out there. And remember to tip your server, not the IRS!


The information on this site is for education only and should not be considered tax advice. Retirement Tax Services is not affiliated with Shilanski & Associates, Jarvis Financial Services or any other financial services firms.

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