September 25, 2023


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2023 US Wealth Administration Outlook: Tax Planning and Wealth Preservation

5 min read

After a down yr for monetary markets, traders’ priorities have naturally shifted from rising their property to preserving their wealth. Whereas threat administration stands out as the key part of wealth preservation, what typically will get missed is how a lot good tax planning can do to assist shoppers retain extra of their wealth.

Shoppers keep loyal to their monetary advisers once they acknowledge that they convey far more worth than merely figuring out top-performing investments. Speaking to shoppers in regards to the full vary of providers you present, together with subtle tax-planning methods, will strengthen present relationships and attraction to extra prospects.

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Beneath are some solutions on improve your tax-planning recreation. You might already be doing all or most of those, so think about these concepts a guidelines to find out should you’re making use of all the most effective practices or whether or not there are areas the place you have to enhance.

No matter what occurs in 2023 — whether or not the markets rebound or a recession brings extra challenges — increasing and demonstrating the worth you possibly can ship to shoppers will likely be an enormous asset. When the markets are serving up nothing however lemons, it’ll provide help to make lemonade.

1. Strengthen Your Relationships with Prime-Notch Accountants

Your contact listing might already be filled with tax professionals who can help shoppers in submitting their kinds and scale back their annual tax invoice. However how shut are these working relationships? In case your partnership with every accountant doesn’t commonly produce two-way referrals, it may not be as sturdy because it might be. Be sure to’re working with essentially the most succesful and proficient tax execs. Do they ship revolutionary and complex shopper options? How a lot expertise with high-net-worth shoppers have they got? Relying on the solutions to those questions, chances are you’ll must construct extra relationships to make sure your shoppers are getting the most effective service on the market.

2. Improve Your Tax-Planning Know-how Capabilities

Are you at present in search of tax-loss harvesting alternatives solely within the last quarter of the yr? Do you depend upon spreadsheets or guide processes to determine them? In that case, work with expertise companions to automate tax-loss harvesting for you and your shoppers. You’ll have the ability to determine tax-saving alternatives all year long and implement them in a manner that isn’t burdensome and time-consuming for you and your employees.

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3. Replace Shoppers about Tax-Planning Alternatives

Tax legal guidelines continuously change, however the previous few years have seen extra modifications than regular. So present common, jargon-free communications to shoppers that specify what’s completely different. For instance, ship an e-mail, publication, brief video, or weblog submit in regards to the Safe Act 2.0 laws handed late final yr. The legislation raises age limits for required minimal distributions (RMDs) from IRAs and retirement plans and affords alternatives to transform unused funds in a 529 faculty financial savings plan to a Roth IRA for the account’s beneficiary.

Such messages will be certain that shoppers take full benefit of those new guidelines and emphasize that you just’re watching legislative and regulatory modifications with an eye fixed in direction of how shoppers can leverage them. Do your high-net-worth shoppers know that the upper threshold for federal property taxes will sundown in 2025 if Congress doesn’t lengthen them? Or that estate-planning instruments like Spousal Lifetime Entry Trusts (SLATs), for instance, can protect their greater property tax threshold? Protecting shoppers within the find out about these items will show that you’re being proactive on their behalf.

4. Broaden Your Tax-Planning Strategy

Tax-favored retirement and faculty saving plans and municipal bonds are among the many greatest funding automobiles for decreasing shoppers’ taxes. However shoppers must know that your tax-planning suggestions can transcend such mainstays. For instance, if shoppers have high-deductible medical health insurance plans, discuss to them about the advantages of well being saving accounts (HSAs) to save lots of for future medical wants, particularly in retirement.

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Good Tax Administration Reinforces Wealth Preservation

Even when the monetary markets absolutely recuperate in 2023, many traders will likely be holding onto one in every of 2022’s key classes: that wealth preservation is necessary in any atmosphere. By displaying shoppers and prospects all that you are able to do to attenuate the impression of taxes on their financial savings and investments will underline how dedicated you might be to preserving their wealth.

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All posts are the opinion of the creator. As such, they shouldn’t be construed as funding recommendation, nor do the opinions expressed essentially replicate the views of CFA Institute or the creator’s employer.

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April J. Rudin

Founder and president of The Rudin Group, April J. Rudin is broadly acknowledged as a prime advertising strategist for the monetary providers and wealth administration sectors. She is acknowledged by Onalytica because the #1 “Influencer” in wealth administration, and is a commonly featured supply of professional commentary to worldwide information and enterprise retailers, commerce publications, and broadcast media. Rudin is an annual contributor to the Capgemini World Wealth Report, produces the Annual Outlook for US Wealth Administration for Enterprising Investor, and speaks about wealth, next-gen, and fintech at conferences all through world. Her thought management has appeared in Huffington Publish, American Banker, Enterprising Investor, Household Wealth Report, Fundfire, and She is the mom of two sons who’re fast to level out that they thought-about her an “influencer” effectively earlier than Onalytica did.

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