Academic journal article Journal of Accountancy

Ten "Musts" for Developing a PFP Practice

Academic journal article Journal of Accountancy

Ten "Musts" for Developing a PFP Practice

Article excerpt

CPAs interested in careers in personal financial planning or who have established practices and would like to create a niche in this area can follow these steps to get started:

[] Select a practice structure. Depending on their firm's purpose or the way they conduct business--including how much liability they are willing to assume or the type of fringe benefits they plan to offer--CPAs can structure their financial planning practices as sole proprietorships, S corporations, C corporations or limited liability companies. Each option has a unique character, set of benefits and legal limitations.

[] Prepare a business plan. All new and established businesses need a written business plan. A good one describes the objectives, strategies and specific actions a person or firm will need to follow to master the business environment. The plan will answer questions such as these: Where is the business today? Where is it heading? How will it succeed?

[] Find a mentor. There is no substitute for experience. Having a mentor helps keep start-up problems to a minimum. Local chapters of CPA state societies or financial planning organizations can offer guidance to new personal financial planners.

[] Get the credentials. A CPA planner needs to master a large body of information to get started or to stay current. Practitioners need to understand financial markets, basic and advanced asset valuation methods, the Internet and macroeconomic principles.

[] Create an advisory board. No successful PFP practitioner can prospect for new clients, maintain a client base, develop new products and still expect to remain current with the enormous volume of fast-changing information affecting the business. CPAs may need an informal advisory board to bring expertise, information, advice and credibility to their practices. …

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