Jan 122018

Every so often, we have a client who decides to take advantage of so-called “bundled services” (kind of like bundling cable TV with telephone and internet services). Such “bundles” typically are offered by asset managers, financial planners, estate planners and other investment advisors, under the guise of “being part of the service.” But just what is that “service,” anyway?The problem stems from the fact that tax consulting, return preparation, audit representation, and tax planning are often so far afield from investment or estate planning that they have little in common save that they all involve money (but so do buying groceries and banking, though I would not want to buy fresh produce at my local bank).

Of course, it has been said that it is not possible to take a client away from a trusted professional unless he is not fully satisfied. This perceived lack of satisfaction may involve loss of confidence, concern over price, or simply customer service (availability, understanding, and a willingness on the part of the professional to address the client’s needs). Still, if a client is somehow dissatisfied with one or more facets of a professional relationship, he should probably try to address those problems where they are or seek another professional, and not allow himself to be lured by the promise of cheap prices and all-in-one services.

Often, financial institutions and estate planners (usually attorneys, in the latter case) work with accounting or tax professionals in order to bundle their services. But who are these loosely-affiliated third parties? Have the clients even met these people to vet them before “jumping ship?” Generally, the answer is no, they have not, and so their qualifications and experience are unknown.

What credentialed, experienced tax or accounting professional would want to put himself in the position of essentially taking a client away from another professional? Generally, these practitioners are more concerned about the short term cash flow from such arrangements than with developing long term, close ties.

Broader tax-related services are another concern. What about handling an audit? Even if the preparer affiliated with a financial advisor is capable of preparing the client’s personal income tax return, what about representation in an audit? What about the client’s business (either his current one or a future one)? To whom will he turn for trusted advice to start his new business?

In our practice, we try to get to know every one of our clients on a personal level. We dine with our clients, are invited – and invite them – to social gatherings, and even share their grief at the loss of loved ones. We become friends with our clients. We know that our income is not made in one or two tax seasons, but over a lifetime. We have had clients for multiple generations, branching out to their extended families, friends and acquaintances, business associates, and employees.

What of these practitioners involved in such bundling arrangements? I wonder if they care to take the time to cultivate such close and lasting relationships with their new-found clientele.

More importantly, I have concern for the clients taking advantage of such offers. Surely, relations can break down between client and professional, and generally such things can be addressed with a personal meeting or two. If fees are a concern, a caring professional will remain open to discussing the issue. In short, clients who leave for silly reasons such as “I got a deal” or “you charge too much” (particularly after being with the same professional for a dozen years or more) are on a fool’s errand.

Financial concerns which dangle tax preparation and accounting services in front of clients of other practitioners instead of trying to forge alliances with those practitioners are doing their clients a disservice. Often, clients need to be reminded of that fact because ultimately, they are the ones who suffer the lingering effects of possibly inadequate representation.

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