← AICPA Personal Financial Planning (PFP)
AICPA Personal Financial Planning (PFP)
Small Planning Conversations That Lead to Bigger Engagements
00:24:34
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- [00:02]
A
I'm Gary Sinnett and this is your personal financial planning podcast. Okay. I absolutely love comprehensive financial planning. I love knowing that every topic has been covered. But then again, I'm not your client. And some clients don't need a hundred page financial plan to feel value from you. Sometimes they need one smart move that you talk about, one overlooked strategy, or one question no one else has asked. In today's episode, Jackie Cummins, Koski and I break down five fast high impact value adds that CPA financial planners can implement immediately. From smarter 529 strategies to forgotten 401k assets and even overlooked HSA opportunities, these are the things you're going to want to talk about when you have just a few minutes to really engage with your clients. These are the kind of quick insights that make clients lean forward and say, I didn't even know we could do that. Welcome to the American Institute of CPAs Personal financial planning Podcast. I'm Kari Sinnett. As the leader of the PFS designation, the financial planning credential exclusively available to CPAs, my role is to keep you informed, educated and connected to a premier community of thought leaders delivering trusted financial planning. We explore the full range of planning topics and the current events shaping our profession. If you're an advisor, a CPA financial planner, or simply want an inside look at today's topic of five quick value adds, this podcast is for you. Our guest today is Jackie Cummings Koske, author, nationally recognized financial educator known for her work connecting financial strategy, behavior and financial independence. She's the author of Money Letters to My Daughter, that's really awesome and Fire for Dummies. You know those handy do yourself book. How do I get this? She also co hosts the Catching up to Fi podcast and that's worth a listen. As a passionate advocate for helping individuals, especially late starters, build confidence and capability around money. Welcome back, Jackie.
- [02:30]
B
Hey, Carrie. Glad to be back with you, my friend.
- [02:33]
A
Yeah.
- [02:34]
B
Hey.
- [02:34]
A
I am going to love these conversations today because these are if you're an elevator, you're at a party, you're talking, or you just want to leave an amazing thought with a client. I am excited about what you have to say, so let's start right out. I really enjoy 529 plans. I've always felt like they resonated with clients and now that 529 plans are kind of expanding, you can do more for K through 12 expenses. I've heard and now hopefully this is true and we're going to find out in a minute. You can even use them strategically to Pay for your own credentials. How should planners, cpa, Financial Planners Advisors, rethink education funding to unlock more flexibility and long term tax efficiency for families?
- [03:28]
B
Yeah, Carrie, these have only been getting better. And some of these things we're going to talk about today, including the 529, is they might be small, but they're always a great conversation starter and they could lead to bigger planning strategies or sort of work in concert with them. But the 529 only getting better. So you mentioned covering your own credentials. So starting with your client themselves, the opportunity to be able to use $529. Because most states will offer a tax benefit, whether it's a credit or it's a tax deduction. They will offer that. Putting money in. Well, you can use that money now to pay for your credentials. You know, whether you're cfp, CPA or whatever, those fees start to up. You can cover it with that. But that's just starting with the one big beautiful bill, Jackie.
- [04:19]
A
So you can even pay for like your annual fees for your credential.
- [04:24]
B
Yeah, your annual fees. Now you, you, you guys are cpa, so you can go look at the letter of the law. But it's pretty broad, right?
- [04:31]
A
I want to make sure.
- [04:32]
B
Yeah, right, it is, it is pretty broad for me. I paid for my annual CFP fees for, for through my 529 plan because I still have money sitting in there and I just, you know, want to go ahead and start to deplete it and, and yeah, it's very broad. So you know, as CPAs take a closer look at it where it might be able to fit your client. But in addition to yourself, they just, you know, with the one big beautiful bill, like I said, that passed in July, they bumped up the K through 12 expenses up to $20,000. So if your kid is in private school, yeah, it's huge. So that's a great option. Then it includes so much more than just education. I used to call 529A College Savings plan. Well, no more. I just call it a 5 to 9 savings plan that covers so much more as your kid is preparing for college. It could cover things like the SAT exam and so many things. So take a look at that if you know your client has kids or, or if they themselves might fall within the parameters of what you can use it for. Great conversation starter. And then let's not forget about like the generational opportunities. Some people will stuff that, you know, five to nine like crazy for the intent of passing it on from generation to generation. And then another, you know, recent change was that if you do have leftover 5 to 9 money, why not start seeding that kid's Roth IRA? Because it has a provision for, for that as well, up to $35,000. But there's just so many changes with the 529. It's certainly worth digging into to see where there's a match to what your client has been looking for or you've been talking about. That might be a little bit of an eye opener for them. And again, the jumping off place to a really good conversation.
- [06:23]
A
I'm going to try to encapsulate this into three quick conversations. And the first is you're going to make a hero out of everybody listening in their office right now. Right after they listen to this, they're going to go to the office right next to them and talk to their credentialed friend and say, hey, did you know you could pay for your credential using your 529? So send a thank you note to Jackie for that. And now you get to be the hero. That's conversation one. That takes about 10 seconds. Conversation two is often we'll get asked, I have some leftover money in a 529. So the answer there is you can build a family scholarship, if you will, a legacy scholarship and just roll that down to beneficiaries. Or conversation three, you can now seed a Roth from the five to nine. Now do you happen to know what the limit amount is or there's some amount that, that, that it's limited to?
- [07:26]
B
Yeah, I believe it's $35,000. And it really is simply a funding source for the Roth. Like the person opening up the Roth, the beneficiary of that 529, they have to meet all the other qualifications. They have to have earned income. You can only contribute up to the max. So it simply becomes a funding source up to $35,000.
- [07:47]
A
But three great conversations right there that you can have quickly where you are delivering immense value and in places that people don't often think about. Yeah. All right. Now I have always loved when people said I can't retire because I'm not X age. Because they don't know about these secret little paths. And many advisors avoid early retirement withdrawals altogether. But section 72T offers a structured way to access retirement funds without the 10% penalty. That's huge. When does this strategy make sense? How can a CPA financial planner evaluate whether the long term trade offs justify the short term liquidity benefit? Because he's still going to have to pay taxes on it. This is just a way to avoid the penalty when withdrawing retirement funds early. Am I right on that?
- [08:47]
B
That is right. And what other people don't know, CPA financial planners do, they know the IRS code 72T that avoids the 10% penal. One thing, it seems like every time this comes up in conversation, Carrie, it's always paired with, oh, it's so difficult, it's so hard. But I think CPAs are uniquely positioned to talk through this in an easy way. Back in 2021, they changed things where part of the formula, like the interest rate, there's a floor now of like 5%, but it's like four different pieces that you plug in and you can run the numbers for your client. But more than anything, you can wrap it around and a financial planning strategy that you might have for someone that's under 59 and a half. Because a lot of people, especially like business owners, people that are at the top of an organization, they sometimes will get part of their conversation trapped inside of a retirement plan. And now they're like, what do I do? 90% of my money is here and I'm ready to cut out. But I'm only 52, you know, because
- [09:51]
A
I'm sure to you listening, you've experienced this where somebody has said, oh, I can't retire because I'm only 56. But the answer to that is, yes, you can. And the principle of 72t is substantially equal payments. Now, this is a great way to take a quick conversation in the elevator to a financial planning engagement where you go, you can. There is a rule where we can look at for you, your particular situation and see how Section 72T withdrawals would work for you so you get access to your retirement funds without having to pay a penalty. I guarantee that you are likely to have a little more conversation after you share this with somebody who's in that situation. All right, next up, Jackie, families, I think they really like the HSA program because it's essentially triple tax free. And now with the ability to maximize is HSA contributions for adult children if they have a high deductible health plan and the allowance to direct primary care fees have even gone up, I think to like 150 or 300 per month. How does CPA financial planners reposition HSAs as a multi generational tool? We have to kind of expand our thinking here rather than just a medical savings account.
- [11:25]
B
Yeah. So a planner, they look at these from like three different angles. Oftentimes when these are talked about, it's either the health insurance person that only, that's only talk about health insurance or it's a tax person that's only talking about taxes. So planner can put all these things together. One thing that you mentioned which changed with the law that passed last year, is you can use it to pay direct primary care subscription fees up to $150 for an individual, $300 a month for a married couple. So Carrie, when I think about, you know, the health part of it that oftentimes go way beyond just the financial part, if it helps give them a peace of mind where they can be proactive with their healthcare, then that's a nice benefit. Now there was a few other things, but one of the really older pieces that people don't think about is that when you have an adult child that is not a tax dependent, but they are still on your health insurance, your high deductible plan, not only can you max it out to the family limit, but also your child can do that again. They just cannot no longer be a dependent and it can be up till age 26 where they're allowed. So that's a unique planning window. But again, that seed money for generational stuff and it's focusing on, you know, this account is specifically for healthcare, which is important to more people even beyond just the immediate dollars.
- [12:53]
A
That is valuable insight and to you listening. If you're serious about delivering value in a profession that is evolving faster than ever, you might want to think about AICPA Engage 2026. It's where thought leadership comes to life. Engage brings together the brightest minds in accounting, tax advisory to challenge your thinking and expand what is possible for you and your firm. And this year, Jackie, are you ready for this? This year I wasn't sure this is true. We are excited to welcome actor, entrepreneur and business leader Ryan Reynolds as a keynote speaker. Now right beyond Hollywood, Ryan has built, you know, this and scaled major brands. It was Whiskey Aviation, Whiskey and Mint Mobile and all these other kind of businesses through bold strategy creativity. And his ads have a deep understanding of audiences connection and really that has been the key for him. So at Engage, he'll share insights on leadership, creativity, building relevance, maybe even how to buy a soccer team and doing that in a rapidly changing world. So join us at Engage 2026. Be part of the professional conversation at one of the biggest events of the year. You can register@aicpaengage.com now there's another conversation that I think is going to be valuable. Jackie and that is around charitable deductions. In the changes that have happened now, people outside of itemizing can take up to, I want to say, $1,000 in charitable deductions. And alongside, you can always bundle gifts together and maybe put that, I'm thinking like in a donor advised fund or something like that. How can financial planners help clients be more intentional about timing and structure? They still want to be philanthropic, but maybe have a substantial impact by doing it smartly. What are your thoughts? There's.
- [15:12]
B
Yeah, so for something like this, I really like sort of a stair step approach. It's like starting them on the first rung, right. Which is something new that will help pretty much every client because even if they itemize, the 90% of the people do not itemize. They take the standard deduction. Now, starting in 2026, you can do a thousand dollars up to a thousand dollars give away in cash. And now you can deduct that thousand dollars. Now the next step would be, you know, some people are probably saying, well, you know what, I do want to give more, a whole lot. I'm not really, really, really rich, you know, well, I can give give away money like the Dells, but if they're interested in that, then a donor advice fund might be a way to strategically say, okay, since you want to do, let's say three or $4,000 a year or $10,000 a year, but you, there's a way that you can actually scoot all that into one year. Now most, you know, CPA financial plans are probably familiar with this, but it's the whole idea of starting small. They might not quite be ready to itemize, but this could be the game changer and the g. And again, you're just starting that confirmation conversation. Okay, so what is your favorite charity? Tell me a little bit about that. How much do you usually give? Oh, you told me you go to church every Sunday and you give you tithe at your church. That could be significant, something that people don't even think about that they could possibly get a deduction for. So smaller on the smaller end, but the thousand dollars for non itemizers. And in the middle would be like a donor advice fund where you can bunch it up and then obviously if they do a lot more than annually, they can take that. But again, a great conversation that goes way beyond the immediate dollars.
- [16:52]
A
I like that a lot because we get client questions that sound like this. It's, you know, I'm not sure I have enough expenses and charitable gifts to itemize. And so where do I fall because it's more than that thousand that they can do and not have to worry about itemization, but they don't really have the rest of those expenses. Well, especially in these coming years where salt is a little bit expanded but that expires in a few years, this might be the time. And so here's the great conversation client. You have a window of time where you could bunch up your contributions, essentially think about how much you're going to give for the next five or even 10 years, put it all into one year, combined with your extra room and salt, in order to go ahead and itemize your deductions in one particular year and then for the rest of the years, okay, maybe you're not going to qualify for itemizing deductions, but that's okay because you got the benefit in this one year. And Jackie, just like you're pointing out then from the donor advised fund, send the church tithe in each year or give to the organizations that you care about a year, two or three down the road, you have control over when those funds actually go out. But you received the tax benefit in the year that you want. An amazing idea there. So thank you for sharing that. All right, this shocked me. There's $2.1 trillion trillion dollars sitting in old 401ks that 32 million abandoned accounts. So maybe we should have as almost a standard part of our conversation with every new person coming in and just even reminding our existing clients, let's go look for that money. Okay. Personally, this happened to me. Now I only had like a thousand dollars sitting in an old 401, but it was my financial professional who actually helped me remember. Oh yeah, I should. There's. I wonder. I can't even remember where it was. I think they, that one company got bought out. But there are sites that will help you find where this is. How can CPA financial planners turn this overlooked issue into both client value and engagement?
- [19:31]
B
Oh gosh, this is such an opportunity. And no one would ever believe that someone would leave behind a 401k or other retirement account and forget about it. But $2.1 trillion don't lie. So, so you might as well, you might as well have this as part of your conversation with them because Carrie, if it shocked me and you, it's going to shock a lot of your clients. So what you can do, I, I feel like one resource to help you help guide this conversation is help them pull their Social Security earning statement and you can look and say, oh, where did you work here? Did you have a retirement plan there. So you want to help people find these and I help jog their memory. So two of the main places is the Department of Labor with the Secure 2.0. In 2022, they created the Department of Labor Lost and found. It's like lostandfound.gov so you can go there. This problem was so big where they created a government website to try to find it. And if you are not able to find it there or you want another easy resource, just Google the state and unclaimed property because every single state has this function, their Department of Treasury. So those are two easy places to help them go find that money. And like you, Carrie, you said you remember your planner helped you do that. So if you want your clients to remember, you go help them find what feels like free money to them. Of course they earned it at the time that they were working at their job, but it's going to feel like found money that their planner helped them find.
- [21:02]
A
Absolutely right. And by the way listeners, we will put a link to the resource in the show notes so that you can go, okay, here's where I go to find that money. Adding on to that, there are places, just like Jackie alluded to, where you can go for each state that your client has lived in and just look up their name and see if they have money. It's beyond just the 401k. It could be they sold a house and when the funds actually settled, we forgot to give the people our forwarding address and so there might be some money left over from the settlement of a house sale or who knows what. So make sure to check that out for your clients.
- [21:42]
B
Yeah, one quick other thing is that in particular, when it comes to lost retirement accounts or any lost funds, it seems to occur occur more often when a loved one or a close person to you passes away. So if there's a deceased spouse in the picture, a deceased parent, a deceased sibling, half the time they don't even know where their retirement accounts are. So how are their heirs going to know? So that is a great place to start. So don't just search for the client name, but perhaps anyone else close to them, especially people that may have passed away because there could be money there
- [22:18]
A
as well, an old checking or savings account that they didn't tell anybody about.
- [22:23]
B
Right?
- [22:23]
A
Jackie, thank you for sharing with our community of listeners. If you're an advisor listening to this podcast and you want to deliver premier financial planning with confidence, consider exploring everything the AICPA PfP section has to offer@aicpa.org PfP. You don't even have to be a CPA. You can get an affiliate membership at the AICPA and then for 269 a year, AICPA members get access to a library of technical guidance, webcast planning tools, and expert insights, all designed to help you serve clients at the highest level. And if you're a CPA with 3,000 hours of financial planning experience already, consider showing your expertise next to your name by obtaining the PFS credential@aicpa.org PFS this is our podcast together, and if this episode helped you in your practice, we'd be grateful and really honored if you shared it with your professional community. With almost 600,000 downloads so far, the AICPA PFP podcast is helping to advance the profession one listener at a time. This has been Gary Sinnett for the AICPA Personal Financial Planning Division. Thanks for listening and until next time, keep earning trust through clarity and guiding with compassion and delivering premier planning that elevates our profession.
- [23:53]
C
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