At the start of this year, total consumer debt reached a new record of $4 trillion dollars. Approximately one-quarter of this total is due to credit card debt. According to Fortune Magazine, the typical American household carries $8,284 in credit card debt alone. While some debt is inevitable, too much enslaves people and makes it impossible for them to get ahead. Accounting firms, such as yours, are in an excellent position to help clients prosper. Here we discuss three important ways you can make an impact.
Teach Your Clients Financial Literacy So They Can Teach Their Children
It’s impossible for clients to prosper if they don’t understand the basics of money management. When working with a client for the first time, gauge their knowledge of budgeting, managing debt, emergency savings, retirement savings, financing large purchases, and other essential financial topics.
When your clients are on the path to financial freedom and competence, encourage them to work one-on-one with each of their children to teach the same lessons. It’s never too early to learn the value of money and how to manage it well. The website 360 Degrees of Financial Literacy has extensive resources about these topics as well as student loans and college costs.
Teach the Value of Employee Benefits When Considering a Job Offer
Young people accepting their first full-time job after college can make the mistake of considering salary alone if they receive more than one offer. Even adults who have been in the workforce for many years sometimes look at the hourly or salaried rate and don’t consider the value of their benefit package.
The Bureau of Labor Statistics (BLS) states that up to 30 percent of the typical employee’s compensation is unrelated to wages. The amount employees must pay for health insurance and whether the company contributes to 401(k) savings are especially important considerations.
Provide Your Clients with Simple Reports to Aid in Understanding
To help your clients prosper, you should understand that each one has a different learning style. Some learn best from listening to you speak, others by reading information you provide, and still others by viewing simple reports that sum up the information you have given them.
Regardless of learning style, most people can benefit from visual aids that show them such things as the current financial performance of their business, their objectives for budgeting or forecasting, and how well they have performed financially in previous reporting periods. It simplifies information that can sometimes be dense and complex for people, some of whom may not want to admit they don’t understand.