Navigating Financial Plans During the Pandemic

Businesses, professions, jobs & almost all fields around the world are highly impacted during COVID-19 pandemic. The U.S. had experienced millions of job losses, market volatility and in this context, Congress allocated budget, launched various schemes, reliefs and programs to back up businesses and individuals from economic fallout. In this context, AICPA (American Institute of Certified Public Accountants) conducted a Personal Financial Planning Trends Survey (PFP) which provided panoramic view about how financial planners remained calmed and confident about their financial plans during these uncertain times. Total 870 CPAs Financial Planners who are members of the AICPA Personal Financial Planning Section, including those holding the CPA/PFS credential were surveyed from May 5-26, 2020.

The PFP survey provided insights for below mentioned points.

  • Authorizes information sharing with competitors
  • Provides information about current issues to media
  • Emphasizes role of CPA Personal Financial Planner

Let’s cruise through the survey points:

Talking with clients early and often:

From when CPAs started approaching clients: The first & foremost point covered under the survey was how often and from when CPA Financial Planners started discussing about finances with their clients. Out of total CPA financial planners surveyed, 76 percent of them said, they had COVID-related conversations with their clients by the middle of March. While more than 42 percent said they contacted their clients by the end of February. Frequency of contacting clients: The second point covered under the survey is the frequency of contacting clients during this pandemic. Out of total surveyed, 75 percent said, they were in regular contact with their clients, including 45 percent reported that the frequency for contacting clients was significantly more frequent than normal.

Assessing Stress Level of clients about their Financial Plan:

Out of the total respondents, 81 percent said clients faced more stress about their financial plan than usual. Out of those 81 percent clients, 62 percent gained confidence in their financial condition after conversing with their CPA.

Proactive planning alleviates the impact of COVID-19 changes:

Changes made by clients in their Financial Planning due to COVID-19: Of the total respondents, 97 percent Financial Planners reported that they made changes to their client’s financial plan. Magnitude of Changes: More than 77 percent of the respondents reported minor changes in their financial plan, while only 23 percent reported substantial change. Changes made in Clients’ Financial Plans: The main change made out of all other changes was investment allocation (62 percent) and spending decisions (59 percent). The other changes include Tax strategy which formed 43 percent, retirement account, such as Roth, IRA, qualified plans was accounted for (41 percent) and retirement income drawdown formed (33 percent).

Professional standpoint of CPAs during COVID-19 uncertainty:

Advice from CPAs to their clients during uncertain times: When CPAs were surveyed for what changes they or their clients made to their investment portfolios during this uncertainty, 57 percent CPAs advised for rebalanced portfolios. 40 percent advised for Purchasing or increasing stake in equities, against 31 percent for selling or reducing stake in equities. 40 percent of CPAs took leverage of a market downturn to do tax loss harvesting, which included more than 35 percent expecting opportunity in Roth conversions. 41 percent remained stick to their investment portfolios.

Published on: Jul 26, 2020



John Bugh

John Bugh is the Chief Revenue Officer for Pacific Accounting and Business Services (PABS), responsible for the strategic direction, planning, vision, growth, and performance of the company’s marketing, branding, and revenue streams.

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