- Published: 14 September 2012
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Many business owners and individuals assume their certified public accountant (CPA) and financial planner have interchangeable roles when, in fact, the two complement each other and can very rarely do the entire job of the other person. This is a matter of education, experience, and certification, but is a topic your Denver Accountant can discuss with a high degree of confidence.
What your accountant can do for youWhen most people think of accountants, the first things that may come to mind are Denver Taxes and how to minimize them each year. That is perfectly understandable and to be expected, especially with complicated and regularly changing tax codes at the state and federal levels. From strategizing to budgeting to sheltering and tax preparation, taxes are their main focus.
But your denver teacher also can identify big picture opportunities and strategies that will help you get — and stay — ahead of the competition. Your CPA will help ensure you are depreciating all the right assets in the most productive way. Is your business structure good for you now and in the long run? What about the fine print in the most recent tax regulations, and how do they affect you and your business? Your accountant should have a deep understanding of these issues, and experience with similar situations.
Here are some of the issues an accountant can help you with:
- Financial statements
- Business growth and succession strategy in relation to taxes
- Tax preparation
- Recommending the appropriate tax shelter for your situation
- Tax laws and how they affect you
- Categorizing expenses and identifying trends in spending patterns
- Recommendations and advice on how to structure your business
- Audit representation
What your financial planner can do for you
Once you understand what a denver accounting firm can do for you, you’ll have a greater appreciation of the flipside when it comes to a financial planner. If a CPA is all about taxes, then a financial planner’s world revolves around investments. Or, more specifically, helping you maximize your investments. Is it obvious yet how these two professionals compliment the other?
Ideally, financial planners are focused on the big picture, though a tad different from the one accountants look at. Financial planners are regarded as goal-oriented and holistic, known to keep an eye on building wealth in the most effective manner while taking into consideration the life goals and needs of clients as individuals. On the business side, a financial planner will provide a more comprehensive look at how your business fits into your life from the logical and emotional perspective. Many individuals have lifelong relationships with their financial planners, often going to them for advice beyond financial concerns simply because of their deep knowledge of a client’s personal life.
Here are the things a financial planner can help you with:
- Asset allocation, with a nod to diversification as a means of minimizing risk
- Investing (short, medium, and long-term, in things like stocks, bonds, etc.)
- Wealth accumulation and protection
- Estate planning
- Insurance planning (disability, life, investment, shareholder protection)
- Changes in the industry that affect you
- Business structure and strategy tips
Finally, there are some nebulous areas where the two overlap in terms of their own business models. Many have tried to create an all-in-one solution, which may or may not work for your situation. Your denver cpa does the opposite: Create a team of individuals that support your needs, whose expertise can be brought to bear in any given situation.