How the Next Generation is Impacting Financial Advisor Retirement

How many of the financial advisors that you know are planning on retiring in the next five or ten years? Chances are you know at least one, and it might even be you. According to research firm Cerulli Associates, Inc., more than 18,000 financial advisors will be leaving the industry in the next five years. This is due, in large part, to the number of older financial advisors who are retiring.

An article posted on Investment News’ website says, “Part of the problem is that independent broker-dealers and registered investment advisors don’t have the means or model for training new people. They depend on the wirehouses and insurance companies to do it, and currently, there are not enough new people to go around.”

That’s right: if you are planning on retiring in the next five or ten years, you may have trouble finding someone who is both qualified and a good fit to take over your book of clients. Tyler Cloherty, the associate director of Cerulli, predicts that by the end of this year the total head count in the financial advisor industry will fall to less than 300,000 with higher attrition rates for independent advisors.

So What’s the Good News?

It’s not all doom and gloom when it comes to the next generation of financial advisors, though. There are a number of things working in your favor if you are either an advisor considering retirement or someone who is new to the field.

There are a lot of business growth opportunities.

For up-and-coming financial advisors, there is huge potential for business growth as more experienced advisors retire. Working with an advisor through their succession plan can leave a relatively new advisor with a very healthy book of clients and a mentor who can help them gain a lot of experience in a short amount of time.

The modern age helps make distance irrelevant.

Thanks to the internet, cell phones, and email, distance isn’t really an issue for financial advisors anymore. Just because you live on the east coast and a new-but-capable advisor lives on the west coast is no reason they can’t take on some of your clients for you. While some clients might prefer an advisor who is nearer to home, others won’t mind having an advisor they only see on video chat (as long as they are handling their portfolio well!).

There are companies that can help you find the right people.

Lastly, the issue of there being too many retiring financial advisors and not enough new advisors to take over is one that’s been acknowledged. Because of that, there are companies like advisorRETIRE™ who can help you make a smooth transition and find someone capable of taking over your book. The key is finding an experienced company who knows where and how to find the right people to make it a successful transition for both you and your clients.

If you are ready to retire and are looking for new recruits to join your team and take over your business, we can help. Contact advisorRETIRE™ today to learn more about our succession planning services for financial advisors and to get started with us today.