Retire on your terms: take control with a continuity plan

The US population is aging rapidly; by 2030, nearly one in five Americans will be of retirement age. With the demand for personalized wealth management continuing to grow, it is the perfect time to consider not just retirement, but business continuity. For business owners, this means not only preparing their financial futures, but also ensuring their practices remain stable and their clients well cared for, even in unexpected situations.

Succession planning is critical for business owners and a key factor for clients when choosing an advisor. Business owners spend years building successful practices, so it is essential they also build them to last. A succession plan focuses on the “after” by supporting a business’s longevity through the development and training of future leadership. This is particularly pressing as recent studies show that 42 percent of advisors, representing 57 percent of industry assets, plan to retire within the next decade.  

However, continuity is not succession, even though the terms are often used interchangeably. It’s critical to have both a succession plan and a continuity plan in place.

A continuity plan goes beyond succession; it protects the business, staff, and clients in the event of unforeseen circumstances. It serves as a safety net meant to keep a business running smoothly in the most unexpected of events. By having a plan in place, advisors ensure that clients are serviced, staff are supported, and the business’s value remains intact.

With the uncertainty life holds (e.g., health issues, death, or natural disasters), a well-crafted continuity plan is not just a safety net; it’s a promise to your clients, employees, and loved ones that your vision endures, even in the face of life’s uncertainties. Recently, the devastation caused by the California wildfires has highlighted the critical importance of planning for the unexpected.

While some advisors assume life insurance is sufficient, it is a separate, but complementary, tool. A well-designed continuity plan provides a clear roadmap for succession, ensuring the practice operates effectively during emergencies. Advisors can maximize their enterprise value and protect their business by having both succession and continuity plans in place.

The time to act is now: The first step in protecting a business and clients is simply making the decision. Waiting until retirement or an emergency is a risk that advisors cannot afford to take. Regularly revising and updating the plans ensures they evolve alongside the business’s unique needs.

Choose wisely: In building a succession plan, it’s crucial to find the right people. The successors brought in will be key to maintaining continuity and will serve as the future of the business. A successor should not only manage the practice, but also share the values and client-centric approach to maintain the relationships and trust built over the years.

Consider stakeholders: For family businesses, a continuity plan should align with an estate plan to protect both personal and professional legacies. It’s important to structure a continuity plan to match the needs of both beneficiaries and successors.

Succession and continuity plans are about protecting a business and the clients served. Yet, it’s more than that. The best way to honor your life’s work is to prepare for its future, even in your absence. Continuity planning isn’t just practical; it’s essential for safeguarding your legacy. It ensures a business’s vision endures and clients remain supported, even as you enjoy a well-earned retirement. 

Delaney Metcalf is SVP of Capital Solutions at Osaic. A veteran of the financial services industry for over 12 years, he has run diligence and completed numerous practice acquisitions and corporate M&A deals to help grow the Osaic network. Having held a variety of leadership roles at Osaic – including Recruiting, Lending, Diligence, and Corporate Development – he currently works closely with Financial Professionals for continuity planning, practice acquisitions, and debt/equity structuring to enhance their enterprise values.