America’s aging population shows importance of succession planning for financial advisers, clients
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America’s workforce is in the midst of a generational transition as baby boomers near retirement and financial advisers need to plan ahead for the sake of their clients and their businesses, according to a financial services industry expert.
The baby boomer generation comprises just over one-fifth (21.45%) of the U.S. workforce, and about 41 million from that generation are currently in the U.S. workforce even as about 10,000 Americans reach retirement age each day. In the financial advisory industry, the average age of an adviser is in the low- to mid-50s, but surveys have found that less than half of advisers have succession plans in place.
«There’s a difference between a continuity plan, which is more for death and disability, and a succession plan, which is more about retirement,» explained Jeff Vivacqua, president of growth and development at Cambridge Investment Research. «The first thing is to get them to remember that they’re a small business owner, we want to protect their largest asset, and let’s do that first by doing the continuity plan for death and disability, and then work up to the ideal strategy for succession which is their exit and how they go out.»
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«It’s the client’s best interest… it’s how do they build a plan that continues the investing relationship with the client into the future generations, whether it’s after the current financial professional or after the current client into that client’s next generation of where their estate may go to and how that’s dispersed,» he explained. «If we
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