I spoke at a conference recently, and I couldn't help but notice the advanced ages of many of my peers.
The fact is that our industry is full of advisers who are approaching retirement age. And, in speaking with them, I learned that a few have succession plans, but many don't.
Instead, advisers vaguely plan to "retire in place," which means to slow down and milk what they've built until there's very little left standing.
I urge you to refuse to fade away.
From ill-suited product recommendations to bad actors, our industry has enough trouble with its tenuous reputation without once-reliable advisers deciding it's better to run out of gas than to top off the tank.
It's a seller's market. And with it, you have an opportunity to do what our industry is not known for: Get creative.
With a little foresight, you can very well have all the time and income you need, and still take exceptional care of the people you've promised to serve, your staff and clients.
I'm referring to partnering with one of the growing RIA consolidators that are in the marketplace. Full disclosure: We did this a couple of years back, and it's been everything we could have hoped.
Why might this be the way to go? Start with meaningful work. Whether it's managing staff, dealing with running the office or the constant technology upgrades, most long-term advisers don't get to spend enough time with their clients.
Joining up with an RIA consolidator allows you to offload the stuff you don't enjoy and spend your energy on the tasks you do.
Another thing that has made our recent majority sale so satisfying is that it's been great for our staff, and the staff of the firms we've merged with. We have team leaders and senior staff within our firm who joined us through our mergers and acquisitions. These folks would have never been able to do what they're doing if their firm had remained small and independent.
Lastly, of course there's the money. Valuations for advisory firms are at all-time highs. Revenues are strong thanks to what feels like a never-ending bull market, so the P/E ratios are at levels we've never seen before.
The fact is that there's lots of capital chasing this space, and that's created the unique opportunity to sell a percentage of your firm and roll your remaining equity into a growing organization.
In the right situation, in a few years your ownership stake could be worth several times the value that your firm holds right now.
My business partner and I didn't just sell for the money. We sold a majority stake in our firm for all the benefits that included. Our employees are thriving because we're growing. My business partner and I are doing what we love. And the value of our equity continues to grow.
With all the options available to you, for the good of your team, your clients, and the reputation of our industry, refuse to fade away.
Scott Hanson is co-founder of Allworth Financial, formerly Hanson McClain Advisors, a fee-based RIA with $4.5 billion in AUM.