“Eventually, everyone will leave the business but most financial planners are not emotionally prepared to leave, nor have they put a succession plan in place” says Sandra Foster, president of Headspring Consulting Inc.

Headspring Consulting Inc. conducted an on-site study at the CAFP conference in Banff earlier this month. A total of 40% of the conference attendees responded to the “succession preparedness” questionnaire.

Although many financial advisors and planners focus on growing and managing their practice, the retention of clients and their assets when an advisor retires, dies or leaves the business is an important issue for the advisor, the firm they work for, and the manufacturers whose products they recommend.

Just 29% of respondents indicated they had a succession plan in place and 13% indicated they were currently working on one. Another 13% indicated their practices were not theirs to sell, and 45% of planners indicated they had no succession plan.

While 16% of planners over 50 are currently working on their succession plan, another 51% indicated they do not a plan in place.

“The results were not surprising. It is not uncommon for professionals to take care of the needs of their clients first, and do their own planning last” says Foster.

Of those who did not have a succession plan, 40% indicated they felt having a succession plan was not a priority and 51% indicated the greatest obstacle to having a succession plan was identifying a successor.

Foster says, “Clients are counting on their financial advisors and planners to look after them. Putting a succession plan in place is not easy, but it helps ensure your business does not end with you.”