In line with the trend currently seen in the insurance industry, H&R Block is looking to grow beyond its tax preparation services into the ever-lucrative investment management arena. The tax services firm, hoping to leverage its relationships with nearly 18 million clients, is hooking up with MoneyStar, the financial sales solution provider, to provide financial planning and electronic access to a repository of mutual funds and annuity products.
According to Don Steele, CEO of MoneyStar, H&R Block began piloting the system in a few remote locations at the end of last year to test for viability and functionality. "We were on a four month pilot with them which validated the technology and the concepts," Steele says. H&R Block elected to go with the MoneyStar system and will be opening this year over 84 financial planning centers,
á la Schwab, that will be located in the "vicinity" of their tax preparation offices. If all goes well, H&R Block hopes to open up another 120 planning centers next year, Steele says.
For financial planning, H&R Block will use MoneyStar's LifeScript system, a financial planning tool that enables money managers to graphically chart client's investment resources and goals. The financial planning tool will connect with the MoneyStar Financial Network, which houses mutual fund products from companies like GE Capital, Franklin Templeton and AIM Investment Management.
The firm will also make use of MoneyStar networking technology that will allow client information to flow back and forth between offices, from tax accountant to financial consultant.
"If you think about the concept, it's wonderful," Steele says. "No one has more financial information about you than your tax preparer. You trust your tax preparer. They can take your information, look at your financial situation, and then determine how to best serve their clients."
The MoneyStar products will be integrated with a host of other systems, including proprietary back-office systems and Clarify, a customer relationship management application.
H&R Block is expecting to be live with MoneyStar's products in December.