Succession Planning in Financial Planning Practices – Building a Legacy, Not Just an Exit
9 min read
For many financial planners, succession planning is one of the most important conversations we avoid having.
As advisers and business owners, we spend decades building relationships, supporting clients through life-changing moments and creating businesses that often become deeply intertwined with our identity. Yet despite this, many firms still leave succession planning too late, treating it as an “exit strategy” rather than an essential part of responsible business ownership. I am exactly one of these business owners!
The reality is that succession planning is not just about retirement. It is about continuity, protecting clients, supporting staff, preserving culture and ensuring the long-term sustainability of the profession itself.
In my view, good succession planning should begin years before it is needed.
More Than a Valuation
Traditionally, succession planning conversations within financial planning have focused heavily on valuation multiples, recurring income and potential acquirers. Whilst those areas are clearly important, they are only one part of the picture in my opinion.
The real value within most financial planning firms sits within relationships, trust and culture. Clients often stay with advisers for decades because of the emotional connection and confidence they feel, not simply because of investment performance or technical advice.
That means succession planning cannot simply be a transaction. It has to be a transition.
The firms that succeed long term are usually those where clients already know and trust multiple people within the business. Practices that rely entirely on one individual adviser create significant key-person risk, both commercially and emotionally.
A succession plan should therefore focus on reducing dependency on one individual and building a business that can continue to thrive beyond its founder.
Starting Earlier Than Feels Comfortable
One of the biggest mistakes I see is business owners believing succession planning only becomes relevant in their late fifties or early sixties.
In reality, succession planning should start far earlier.
Unexpected illness, family circumstances, burnout or changes in personal priorities can happen at any stage of life. We encourage clients to plan for uncertainty every day, yet many business owners fail to apply the same thinking to themselves.
Starting earlier creates more options. It allows time to identify future leaders, develop talent internally and gradually transition responsibilities in a way that feels natural for clients and staff alike.
It also reduces the pressure of making rushed decisions during emotionally difficult periods.
Importantly, early planning also enables business owners to ask themselves difficult but necessary questions:
- What do I actually want my future to look like?
- Do I want a full exit or a phased transition?
- Is legacy important to me?
- Do I want to protect my firm’s culture?
- What matters most financially and personally?
Those answers should shape the succession strategy.
Succession Should Be Planned Like Growth
Now in my early fifties, succession planning has become something I am actively considering within my own business. Whilst I still have enormous passion for financial planning and the profession, I also recognise the importance of planning responsibly for clients, my team and the long-term future of the business I have spent 30 years building.
In reality, I believe we should plan our eventual exit in the same thoughtful way we plan to create and build a business and brand in the first place. Succession should never be an afterthought, or something only considered approaching retirement. Strong businesses are built with sustainability and continuity in mind from the outset.
For me, this has meant looking carefully at how we continue developing the people within the business and ensuring knowledge, relationships and responsibilities are not concentrated solely with one individual.
That includes encouraging team members to continue upskilling, broadening responsibilities and growing confidence. At the same time, I am actively looking for the next generation planner to join the business — someone who shares our values, genuinely cares about people and wants to build long-term trusted relationships with clients.
Succession planning is not about stepping away tomorrow. It is about creating continuity, opportunity and stability long before it becomes necessary.
Developing the Next Generation
One of the greatest challenges facing financial planning is attracting and retaining the next generation of advisers.
Succession planning therefore cannot exist in isolation from talent development.
If we want sustainable firms, we must actively invest in people. Mentoring, training and creating genuine career pathways are essential, particularly for younger professionals entering the industry.
Too often, succession conversations focus solely on selling externally rather than developing internal talent capable of one day becoming future leaders or shareholders.
Internal succession can be incredibly powerful when done well. It preserves relationships, protects culture and often provides reassurance to clients who value continuity and familiarity.
However, it requires long-term commitment from existing leadership. Future advisers and managers need exposure to clients, operational understanding and leadership opportunities long before any ownership transition occurs.
This also means creating environments where younger professionals feel they can build meaningful long-term careers within financial planning rather than seeing the profession purely as sales driven.
Diversity and Representation Matter
Succession planning also presents an opportunity to improve diversity within financial services.
Historically, leadership within financial planning has often lacked diversity, particularly at ownership and board level. If we want the profession to remain relevant and representative, we need to actively encourage broader participation and leadership opportunities.
That includes supporting women, younger advisers and individuals from different educational and socioeconomic backgrounds.
Visibility matters enormously
Many people still do not realise financial planning is even a career option because they do not see themselves reflected within the profession. This is particularly true for school leavers and young women.
Over the past year, I have consciously stepped outside my comfort zone to help raise awareness of the profession publicly. Appearing on national television alongside Martin Lewis in front of more than six million viewers was something that challenged me personally as someone naturally far more comfortable behind the scenes.
However, I recognised the importance of visibility and representation. If we want more women and young people to consider financial planning as a career, we need role models willing to step forward and show that there is a place for them within the profession.
Protecting Culture During Transition
One of the biggest concerns for many business owners is what happens to culture during succession.
For founder-led firms especially, culture is often personal. It is built through years of shared experiences, values and ways of working.
This becomes particularly important where firms are considering mergers, acquisitions or external sales.
The highest valuation is not always the best outcome.
Owners should carefully consider:
- How clients will be treated
- Whether staff will remain supported
- Whether service standards align
- Whether the acquiring firm shares similar values
- Whether vulnerable clients will continue receiving appropriate care
- Whether the existing culture will survive
Clients can quickly sense when transitions are poorly handled or commercially driven at the expense of relationships.
Successful succession planning requires honest communication, empathy and gradual relationship-building wherever possible.
The Human Side of Succession
There is also a deeply human side to succession planning that is often overlooked.
Many financial planners are exceptionally driven individuals who struggle to imagine stepping back from businesses they have spent decades building. For some, identity and business become almost inseparable.
However, sustainable leadership requires balance.
Over recent years, conversations around wellbeing and mental health within professional services have become increasingly important, and rightly so. Long-term success should not come at the expense of personal health, relationships or quality of life.
Succession planning allows business owners to create more sustainable futures both for themselves and their teams.
In many ways, succession planning is actually an act of leadership.
Final Thoughts
Succession planning should not simply be viewed as preparing for an ending. It should be viewed as creating continuity, opportunity and legacy.
As financial planners, we spend our careers helping clients prepare for the future. We should apply the same principles to our own businesses.
The firms that will thrive long term are those that invest in people, develop future leaders, protect culture and embrace change early rather than react to it late.
Ultimately, succession planning is not just about preserving the value of a business. It is about protecting the people connected to it — clients, colleagues, future advisers and the profession itself.
And perhaps that is the true definition of legacy.
Frequently Asked Questions
External links for more information
Martin Lewis: A beginner’s guide to investing featuring Kate Gannon
