In an industry where the average age of a financial adviser is 58 and rising, the topic of retirement is often part of daily discussion. Having worked hard to build and maintain a profitable business and client bank, now is the time to create an exit strategy to move onto the next stage in your life, taking into consideration your current lifestyle, retirement plans and as always, what’s best for your clients.
If you don’t already have one, you may wish to consider the four following strategies now to ensure both you and your clients are prepared for the future.
Training a Junior Adviser
Perhaps you have a junior adviser or hope to recruit one that you can train to take over your business and your clients when you leave. However, hiring a junior adviser is most suitable if you have time to implement a long-term training plan, committing yourself to providing full training, time and support to the adviser who will ultimately have the responsibility of protecting your clients in the future.
Working in Retirement
You may not be thinking of selling your client bank yet, but as an adviser with a duty to your clients, you should start thinking about your exit strategy on the day you set up your firm. Not everyone who reaches retirement age, chooses to take a full retirement. You may wish to continue working with all or a select number of your existing clients. Although you have no plan to give up your book of business yet, it is vital to have an exit strategy in case of an emergency or should your plans for retirement change.
Selling Your Client Bank for Retirement
For many advisers, their exit strategy is often to sell their book of business in order to retire. If you are planning to sell your client bank, you will need to consider a firm who has the means to purchase it, but also one whom you can trust to service your clients when you are gone.
Merging Your Practice
If you don’t wish to service your clients anymore, but don’t want to sell them outright, you can choose to merge with another practice, selling your assets upon retirement to someone who shares your values and practices.
Similar to training a junior adviser, this long-term succession plan is appealing if you want to actively participate in building the bridges between your current clients and the advisers eventually taking over their investments.
Whether you are planning on selling your book of business or passing it on to an up-coming financial adviser, it is important you have a plan in place to protect the future of your business and your clients.
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Your capital is at risk. Investments can fluctuate in value and you may not get back the amount you invest. Past performance is not a guide to future performance. Tax rules can change at any time.