Celebrating Advice: Using tax planning to drive advice

Blair Corkum, CA, R.F.P., CFP, CLU, RHU, FDS President Corkum & Associates Charlottetown Years in the business: 31

About me

As a public accounting office, I am not licensed to sell product, and offer advice only on an hourly basis. I consider myself a chartered accountant offering business and tax advice, with a niche in financial planning and family law financial advice.

How I work with clients

CAs develop relationships with their clients—after all we are scheduled to see them at least once a year. With successful long-term relationships comes trust and this leads to many requests for additional financial guidance and second opinions.

Most of my financial planning work usually consists of one or two specific components such as an investment portfolio review, estate planning, insurance reviews or retirement planning. After discussing the client’s needs and expected time commitment by phone, I provide a brief questionnaire, including a net-worth summary, to each client to prepare in advance.

The mandatory part is that they write down their specific questions. This brings focus to the meeting, and allows me to be efficient and successful because to have a satisfied client, all I need to do is answer their questions. Their questions usually lead to many more, and may or may not lead to several meetings. I have a simplified engagement letter for each such engagement, and depending on the client’s wishes, follow up with a letter summarizing our meeting.

I will meet or contact other advisors to help with implementation, if needed. Many clients will ask me to prepare or review their future personal tax returns, and this allows us to update their planning each year. One such client is a retired medical professional. Each year, he arrives with his tax return and a list of about 20 questions to discuss. It is always a very interesting meeting.

My philosophy

I have no minimum net worth standards for clients. My ideal client is a person with respect and integrity who is interested in receiving and acting on good advice, is willing to share stories, and, of course, is able to pay my hourly fee.

When I went to school, I remember the definition of a professional partially being “someone who put their customers’ needs first.” That component seems to have disappeared over the years, but I still believe it is the sign of a true professional. Being a professional both in action and appearance has always been important to me, as is integrity.

If clients suggest overly creative tax maneuvers, I stand my ground to do what is right, such as properly reporting common-law relationship on tax returns. I find most clients respect me for my position.

The best solution is not always the one that creates the most wealth. Advisors need to be human, and understand their client’s emotional needs when organizing their affairs.

Regardless of our own beliefs, sometimes a portfolio must be 100% fixed income. Even if it will generate less wealth in the long run, it will allow the person to sleep at night. Paying more tax than necessary is sometimes better than a complex estate freeze or family trust solution if implementing such a structure will leave the client permanently confused.

When an investment advisor looks at the glass of water, he will tell you that it is half full, and is filling up quickly so you should buy a bigger glass. An insurance agent will warn you that a half-empty glass leaves the future uncertain so you should insure against possible consequences. An accountant will tell you that you paid too much for the glass because it is too big.

My goal is to ensure my clients have considered all these issues, focusing on the importance of the water, not the glass.

Why I matter

In the early 1990’s, I was meeting with the late Gene MacLellan, writer of Anne Murray’s Snowbird, to review his finances—an exercise that I am sure was not one of his favourite pastimes. I always remember him looking at me and saying, “You enjoy your work, don’t you?” After I said “yes,” he responded, “I thought so, because it just exudes from you.”

I think he was quite perceptive. If you like what you do, you will do it to the best of your ability.

One of my favourite clients, whom I had known through a prior employer, actually “interviewed” me before following me to my own firm. After becoming great clients, they confided to me that their initial concern was my small size, since they were formerly working with a large national firm. They ultimately concluded that it was the person, not the company, who was most important. They have also expressed their appreciation that I take family values and qualitative matters into consideration—life is not all about money.

One of my most loyal clients is an individual from Yarmouth, N.S., who I met in 1981 when I practiced in Halifax. There was a new tax saving measure that his advisor had not mentioned to him, and his insurance agent had seen me implement it for another client. I remember his very tough decision to give up working with his then-advisor, a fellow church member and long-time acquaintance.

But he saw that he needed more help than he was getting based on some advice I gave him in a brief complimentary meeting at his home. I also personally travelled every year to work hands-on with him and his small business. When I moved to P.E.I. and sold my business to my partners, they reduced service to him because they did not like the travel, which was three hours from Halifax.

What a privilege when he contacted me again, and in return for me staying involved, he would fly my assistants and me from P.E.I. He is now one of my largest clients, and my team and I service three generations of that family.