Millennials are a mobile generation. They like to consume services via their phones, have a very positive and open approach to technology and appreciate the flexibility it brings to their work and personal life. Today’s millennial workers switch jobs much more often than their predecessors. Millennials are more likely to move to a different state when switching jobs, receive equity compensation, and earn additional income outside their full-time jobs. They also carry more responsibility for their own retirement accounts and savings.
A recent study found that 80 percent of millennials worry about their taxes, such as making a mistake on their taxes, not getting a full refund or paying too much, according to a survey conducted by Harris Poll and commissioned by Nerd Wallet. Despite these worries, millennials are less likely than other age groups to turn to professional tax advice: only 17 percent of millennials hire a tax professional, compared to 29 percent across all age groups.
Why are so few millennials not seeking help from tax professionals?
We believe that the tax industry is not meeting the evolving needs of the millennial workforce. Presently, there are two dominant models for delivering tax services: do-it-yourself software and in-person CPAs. Do-it-yourself software does not help people navigate the growing complexity of their financial lives. Taking time out of the day to trek to a physical office and sit there while a CPA does their taxes offers none of the convenience and flexibility of mobile technologies.
Millennials want proper tax advice. They want a tax service that helps them navigate their financial lives and helps them optimize their taxes. And that tax service needs to be delivered where the customers are, which is online and on their smartphones.
What does that imply for the tax industry?
We believe that the tax industry must adapt to the changing needs of its clients. We need to address the concerns our clients have around hourly pricing, and we need to deliver services online rather than in-person. The key to implementing these changes is embracing advanced technology.
Improving profit margins is a key reason many businesses adopt technology and automation. But we need a different perspective. We can use technology to create a better tax service and to create more value for our clients.