Tax planning differentiates you from other advisors

If you’re not helping clients plan what they pay in future taxes, eventually “your clients will find someone else who will,” said six-year MDRT member Kasey Massatti in her 2018 MDRT Annual Meeting presentation.

To make sure she’s not giving her clients a reason to go elsewhere, Massatti makes tax discussions part of her financial planning process. Furthermore, she wants her clients to know that she’s taking a holistic view of their finances and ensuring they have as much money as possible for retirement.

Think about tax-free savings

“What are you doing to help clients save for the future?” asked Massatti, of Lancaster, Ohio. “You want to help clients have a tax-free future.”

Paying more in taxes won’t get clients a better retirement. Why, especially after decades of savings, would anyone want to see large portions of their retirement funds eaten up by taxes? To make sure she’s using every available method to help her clients with this issue, Massatti works with accountants and attorneys to understand the impact of taxes on her clients’ retirement and savings goals.

She then advises clients about what they can do to work toward a portion of their retirement funds being tax-free, or taxed now instead of later. If clients pay taxes on their retirement income now, with a U.S. product like a Roth IRA for example, it’s likely taxes will be lower than in the future, Massatti said.

The advantages of life insurance

Life insurance overfunding is a great way to save money tax-free, Massatti said. Young, healthy clients especially go through underwriting easily. Massatti also outlines the other advantages of life insurance, such as how it assures clients will create a legacy for their family, even if they die before saving enough. In addition, some of her clients who want to partially retire while in their 50s use life insurance to help fund this decision.

Life insurance products can be designed in different ways to meet clients’ needs. It can give you money for retirement or as a way of legacy planning for the next generation, Massatti said.

See more in her presentation, “Life insurance for wealth accumulation with a tax-efficient mind.”

Written by Antoinette Tuscano, MDRT Content Specialist

Also, watch “How to skyrocket your business by presenting a comprehensive plan.” In this video, Top of the Table qualifier Ali Hashemian, CFP, MBA, discusses how he uses tax planning when he’s designing cases.