By Scott A. Critchfield

St. Patrick’s Day may be a fitting time to ask yourself an important question: when it comes to my retirement, am I relying on a bit of leprechaun luck—or am I following a well‑defined plan? Maybe you’ve started thinking about a successor or sketching out a rough transition timeline. Or perhaps you’re quietly hoping that, like a rainbow after a storm, everything will simply work itself out.

If luck has been doing most of the guiding so far, it may be time to improve your odds. Retirement — especially for a financial advisor — is too important to leave to chance. As someone who helps hundreds of clients plan for this very milestone, it’s worth turning that same thoughtful lens inward and taking time to envision what retirement could truly look like for you and your family.

Big Picture First

Experience has shown that the biggest stumbling block for financial advisors nearing retirement is not their financial preparedness. The most worrying concern (which, sadly, is often not recognized until after leaving their profession) is what they will do with their time once retired and what their civilian identity will be.

So where do you start establishing your personal readiness? Put yourself through your own discovery process. What are some bucket-list items you want to do in retirement that you have never had time to do while fully employed?

• Activities – golf, sailing, hiking, tennis, pickleball, traveling, reading 
• Locations – places you would like to visit; how often you would like to go 
• Volunteerism – organizations you would like to be a part of beyond just donating money; Habitat for Humanity®, your church, local homeless shelter, other organizations where you could leverage your financial skills and knowledge 
• Family visits – if you have family spread around the country, how often would you like to visit them or travel with them? 

Run a Plan

Once you have your bucket list, and meaningful ingredients penciled in, just like you would with a client who has retirement as a goal, begin building your plan. Nothing new here, except you are the client. You have done this hundreds, if not thousands, of times for others. The questions and answers are now coming from you. Your objective is to identify a target and the gap – how much will you need to achieve your desired retirement dreams by the time you want to exit and how close or far away are you? 

Next Steps

In many instances, your target number may not be immediately recognized. So, what are your next steps? Well, just like you would share with your client looking toward retirement, you have a few paths to follow. As it relates to the valuation of your business and its role in contributing to your retirement plan, let’s look at a few of those paths: 

1. Grow your practice to a target value.
   • The days are gone when buyers will simply pay a selling advisor based on their trailing 12-month revenue. A prospective buyer cares about what they will be earning rather than what you have already received. Therefore, predictable income is a significant factor when valuing your business.
   • Recognizing strengths in your practice and building on them or reinforcing any weaknesses today can help improve the value of your practice tomorrow. 
2. Solidify your investment philosophy.
   • Ask yourself:
     • “Do I have one?”
     • “Can it be replicated/duplicated by the acquiring FA?”
     • “How long will it take for me to teach it?” *
       •    * Do you have your process written down so it can be easily followed?
   • The answers to these three questions influence the value given to the multiple placed on your business.
3. Consider your practice’s age demographic.
   • It is only natural that your client base will age with you. From your stance as a selling advisor, you will want to demonstrate the breakdown of your client base to show how the assets may move in the future – particularly in your over age 70 audience. Not just because of the risk of death, but more importantly due to required minimum distributions.
4. Be intentional about your service model and infrastructure.
   • Do you have enough bandwidth to provide platinum services to your clients?  Do you have any gaps in the services you provide (e.g., insurance or advisory)? Do you delegate tasks to other members of your team? Would team members be better suited to handle some of your households while you concentrate on others? Do you have reliable people on your team who can step up when needed? All of these factors affect the valuation of your practice in a buyer’s eyes.
5. Be aware of other factors that influence valuation.
   • The above elements are not the only ingredients to consider; there are many others as well. You will want to partner with a valuation professional who can provide you with informed counsel that is not influenced by the emotional ties of the business.

Mark Your Calendar

You have heard the adage “A goal without a timeline is just a dream.” Set a target date. It doesn’t have to be set in stone (if it were, would it be the Blarney Stone?), but “if you don’t know where you are going, anywhere is fine” isn’t just a cliché. By at least having a finish line in mind, you can then work backwards and begin setting mile markers and checkpoints to measure your transition progress and set objectives for yourself. Advisor transitions tend to take much longer than FAs expect, especially when you consider the time it takes to find and become comfortable with a successor, not to mention the time it takes to message clients and introduce them to your replacement. A nice, long run ramp is ideal.

Take the First Step

The best time to plant a shade tree was 10-15 years ago. The next best time is now if you are planning to retire in 5-10 years. In our profession, there is investing and there is planning.

While rainbows do follow thunderstorms when the sun shines, there are no guarantees a pot o’ gold will be in sight without purposeful planning and tapping into the resources available to you. Don’t leave it to chance or luck. 

If you are approaching retirement and would like to have a succession plan in place, we have a dedicated succession planning team ready to help and support you. Visit us at benjaminfedwards.com.

Have a great St. Patty’s Day!  

If you would like more information about the opportunities available at Benjamin F. Edwards, contact Matt Waltrop, Vice President of Branch Development, at 314-480-3662 or branchdevelopment@benjaminfedwards.com