Why Your Financial Planner, Accountant and Solicitors Should Talk to Each Other

Good financial planning rarely happens in isolation.

Some of the best outcomes we’ve seen for clients haven’t come from a clever investment strategy or a tax wrapper nobody else had thought of. They’ve come from something much simpler: sitting around a table with a client, their accountant or solicitor, and talking things through together.

There can be a misconception that financial planners, accountants and solicitors should each stay in their own lane. In reality, some of the best planning happens when those lanes overlap.

Your accountant understands the ins and outs of your business finances and tax position. Your solicitor understands the legal structures protecting you, your family and your assets. As financial planners, we look at the bigger picture – your finances, your plans for the future and how all those different pieces fit together over your lifetime.

When everyone talks to each other, you get advice that is joined up rather than simply added together.

When financial planning and accountancy come together

Take a business owner who is planning to extract a significant sum of money from their company ahead of retirement.

On paper, there may be several ways of doing this. But the most appropriate and tax-efficient route can depend heavily on decisions being made around the company’s year-end position, profits and dividend planning.

Rather than working separately, we can sit down with the client and their accountant and look at the position together.

By comparing notes and understanding what each professional is planning, rather than making assumptions about what the other is doing, decisions can be coordinated around both the company’s finances and the client’s personal financial position.

In one such case, this approach meant the timing of a payment could be planned much more effectively, allowing the client to retain considerably more of their own money.

The difference wasn’t a complicated new financial product. It came from two professionals taking the time to work together.

When financial planning and legal advice overlap

The same principle applies to estate planning.

Imagine a client who is arranging a new will and Lasting Power of Attorney with their solicitor.

The solicitor can draft the legal documents, but those documents form only one part of the client’s wider financial and estate planning. How pensions, investments and other assets are structured – and what happens to them on death – also needs to be considered.

In one case, we arranged a meeting between the client, their solicitor and their financial planner.

During that conversation, we identified that a significant pension death benefit may not have passed in the way the client assumed under their existing nomination.

Because everyone was involved in the conversation at the same time, the issue wasn’t lost somewhere between separate meetings and emails. It could be identified, discussed and addressed as part of the client’s wider estate planning.

That gave the client something equally valuable: greater peace of mind that their affairs reflected what they actually wanted to happen.

Your financial life doesn’t fit into separate boxes

That, to us, is what collaborative financial planning is really about.

Your financial life doesn’t come in neat, separate boxes labelled tax, legal, pensions, investments and business.

A decision made in one area can have consequences somewhere else.

If your accountant makes a recommendation without knowing what you’re trying to achieve personally, part of the picture may be missing. If your solicitor is planning your estate without understanding how your pensions and investments are structured, there can be gaps. And if your financial planner doesn’t understand what is happening within your business, they may not have all the information they need either.

Good financial planning should bring those pieces together.

Get your professional advisers around the same table

If you already have an accountant or solicitor you trust, consider whether it would be useful for them to speak directly with your financial planner.

Sometimes a joint meeting can uncover opportunities, prevent something important from being overlooked or simply make sure everyone is working towards the same objective.

It can potentially put real money back in your pocket. In other situations, the biggest benefit may simply be knowing that the people advising you are talking to each other and that all the pieces of your financial life fit together.

At 8 Financial Planning, we believe financial planning works best when it looks at your whole life, not just one product or one decision at a time. Where appropriate, that means working alongside the other professional advisers you already trust.

If you’d like to talk about how joined-up financial planning could work for you, get in touch with 8 Financial Planning to arrange an initial conversation http://www.8fp.co.uk

The information contained in this article is for general information purposes only and does not constitute personal financial, tax or legal advice. Tax treatment depends on individual circumstances and may be subject to change. Where appropriate, specialist tax and legal advice should be obtained.

8 Financial Planning is authorised and regulated by the Financial Conduct Authority.