The life of a financial advisor has a certain trajectory. As a ‘rookie’ you will generally take anyone and everyone, no matter the product and services they require. Assets and household counts matter. As your business matures most advisors pivot to a pure assets under management strategy. Gather as much AUM as you can.
But what if you’ve successfully navigated those initial stages and are looking to the second half, or twilight, of your career. How can the makeup of your book serve to maximize your value as a financial advisor?
We think there are five key points that will maximize value in the best possible way, here they are:
Depending on what source you look at, the average age of an advisor in the financial services industry is anywhere from 51-57 years old.
While that would typically leave plenty of time until the average age of retirement, the average age of an advisor selling their business is much younger, most often occurring near age 59. This is due in large part to the long term seller involvement that is ideal in the sale of a professional services business, ranging from as low as 12 months to as long as 5 years.
While you may not sell your business, you will leave this industry – planned or unplanned. The better prepared you are for your eventual transition, the happier your clients will be with the process, and the more you are likely to get out of it (financially and emotionally).
The following recommendations will help position your business to obtain the most value and attract the best successor:
Selling your practice starts with understanding what it is worth. At 3xEquity we built our brand on providing comprehensive valuations that take into account all of the many ways you have created value, from the obvious to the hidden intangibles often overlooked by others.
For a limited time we are providing free valuations to select advisors. To see if you qualify and to receive additional resources that will increase the value of your practice ahead of a sale, please complete the form to the right.