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Did you see this week's Briefs?

October 12, 2017  —  Volume 12, No. 31

  TaxCoach Briefs: A Win For The Good Guys
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TaxCoach Briefs
 
 

 

Advisor Architect Webinar

Build the business you really want with Advisor Architect for Accountants.  Join Lisa Wells and Dan Cuprill on October 17 at 2 PM EST for an informational webinar about the program. 

Register here.  

 

The CTM Tax Strategy Conference 

November 15-17. 

Space still available, go to 
www.TaxCoachSystem.com/CTM  or call Alyssa at 513.321.2820 for more information.

 
A Win For The Good Guys
 
Earlier this week, the Nobel Foundation announced that Professor Richard Thaler of the University of Chicago’s Booth School of Business had won the 2017 Nobel Prize in Economics. Thaler made his bones through his study of behavioral economics, the search to understand how psychological, social, cognitive, and emotional factors affect financial decisions. His newest recognition is a timely reminder this tax-planning season that we can’t appeal to logic and reason alone to sell our services. The more you know about the science that earned Thaler his win, the more effective you’ll be in building your business.

 

Did you ever take an economics class in college? If so, your professor probably introduced you to an impressive fellow named “Rational Man.” Rational Man looks at all his financial choices through the clear cold lens of reason. He balances pros and cons, weighs factors, and calculates expected values. In the end, he makes the rational choice. Together, acting rationally, we all make up the great “market,” which translates rational choices into solutions for problems involving scarce resources.

 

Except, of course, that’s nonsense. “Rational Man” doesn’t exist. People don’t act rationally at all. We act emotionally. Our judgment is clouded by bias. (And economists really ought to be studying Rational Woman, because studies show that when it comes to investing, women are less emotional than men.)

 

The good news is, we can study how those factors affect decision making. As the Nobel Foundation said in announcing  Thaler’s prize, he “has incorporated psychologically realistic assumptions into analyses of economic decision-making. By exploring the consequences of limited rationalitysocial preferences, and lack of self-control, he has shown how these human traits systematically affect individual decisions as well as market outcomes.”

 

Thaler seems determined to prove himself right with his prize money: he has already announced he intends to spend the million-dollar prize “as irrationally as possible.”

 

Here at TaxCoach, our marketing approach is built on a solid foundation of quantifying and communicating your value. If you objectively save a client $10,000 in taxes, and you communicate that value to him, you’re appealing to the most calculating part of Rational Man’s logical mind.

 

But sometimes logic and reason just aren’t enough. Sometimes you need more. So we incorporate insights from behavioral economics into our system. Take pain versus gain, for example. If your prospect isn’t excited about saving a few thousand dollars (gain), take advantage of the “endowment effect” to remind them that they already have those dollars, but their failure to plan is letting that money slide through their fingers (pain). Behavioral economists like Thaler have established that prospects feel the emotional impact of pain twice as hard as the emotional impact of gain.

 

Thaler has written several popular books on the topic, and he’s definitely worth reading once you’ve knocked out the rest of your extensions. Start with Nudge , which he co-authored with Harvard Law School Professor Cass Sunstein. The book reveals how people really make choices, and outlines how to use “choice architecture” to nudge people to make better decisions. You’ll quickly see ways that you can structure your marketing and presentations to help nudge prospects to hire you!

 

Member Success
 
Here’s yet another comment from yesterday’s Marketing and Management Call that pretty much speaks for itself:

 

“I have a meeting with a person who is a referral from a client and he doesn't fit my typical client profile. He is an electrician that is having a high income year and has not gotten help on tax planning from current CPA. Typically, I would give him some great tax planning and charge my hourly rate, but I plan to use the information I have received from you on selling him a tax plan instead. Thanks for all your great info.”

I have to confess that I cringed when I saw the words “hourly rate.” This is 2017, people; hourly rates are dead! But I smiled when I saw our member planning to charge a value-based fee instead. Even Rational Man understands there’s value in paying for value!

 
 
Not a member? Click here for your 15-day FREE TRIAL!
 
 

TaxCoach Briefs:

Vol. 12, Number 29;

October 12, 2017

 
A Win For The Good Guys
 
Advisor Architect for Accountants

 

Members Only
 
Member Success
 
 
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Edward A. Lyon, JD, CTC

Publisher

 
Preferred Partner
 
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Advisor Architects for Accountants 
 
Introducing a comprehensive curriculum, consisting of personalized coaching and eight modules delivered over a 14-month period, designed to systematize your entire business plan. Our coaches will take you step-by-step through the resources you need to implement each system to create a more profitable, less frustrating practice.
 
To learn more, visit www.TaxCoachSystem.com/AAA
 
 
Members Only
 
Next Tuesday Technical & Case Study Call-In :
Tuesday, October 24 at 2:00 pm Eastern (11:00 am Pacific)
 
On this monthly call, we take all those technical tax questions we discourage on the Wednesday Marketing & Management Call-Ins. Bring us your knottiest, gnarliest question, and we'll see if we can find your answer!
 
 
Next Wednesday Marketing & Management Call-In:
Wednesday, October 18 at 1:00 pm Eastern (10:00 am Pacific)
 
Join Ed, Keith, and other TaxCoach members to ask any questions you have about TaxCoach strategies, features, or philosophy, or just to talk marketing and practice management.
 
 

Next Monthly Partner Webinar (All-Stars and CTM Partners):

Tuesday, November 14 at 4:00 pm Eastern (1:00 pm Pacific)

 

The All-Stars program itself currently has one spot open. If you're interested in joining, call Alyssa at (513) 321-2820 to schedule a pre-interview to see if the program is right for you.

 
 
 
 
Want to see how TaxCoach can improve your business? CLICK HERE for a 15-day free trial.
 
 
 
 
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