What Happens When Your Advisor Retires?
Navigating the retirement of your financial advisor can be overwhelming, especially when working with someone who runs a one-person operation. The departure of your retirement advisor can lead to unexpected challenges, like service disruptions, unanswered questions, and the daunting task of starting over with someone new. But it doesn’t have to be that way. Here’s what you need to know to navigate these transitions—and why a true financial team might be the better option.
1. The Retirement Announcement: A Wake-up Call
In a solo practice, news of retirement can sometimes arrive with short notice, leaving you scrambling to figure out your next steps. Even with more advanced warning, continuity can be difficult since the entire relationship revolves around a single individual.
What to Expect in a One-Person Setup:
- A personal call, email, or letter informing you of the decision.
- Timelines outlining when services will end—or an abrupt exit if health or personal reasons are involved.
- A referral to another advisor (if you’re lucky).
2. Service Disruptions: Avoiding the Black Hole
When a solo advisor retires, your financial plan often suffers. If they were managing your investments or working on a long-term strategy, their departure could leave you in the lurch, scrambling to regain footing.
Potential Issues with a Single-Advisor Operation:
- No one to pick up where your advisor left off.
- Difficulty retrieving files, portfolios, or notes.
- Timelines for investments or projects could stall or fall apart.
3. Built-in Succession Planning: No Gaps, No Guesswork
One of the biggest risks in a one-advisor operation is the lack of a built-in succession plan. Without a designated backup, you may find yourself starting from scratch with a new advisor who has no background on your situation, losing valuable time in the process.
Challenges When There’s No Backup:
- Starting over with someone unfamiliar with your personal preferences and financial history.
- Risk of important nuances and details falling through the cracks.
- Delays as the new advisor learns your goals and situation from square one.
4. Financial Continuity: Avoiding the Pitfalls
When your financial advisor retires, the risk isn’t just emotional—it can have real financial implications. Missing access to accounts or mismanaging transitions can result in costly mistakes.
What to Watch for with a Solo Advisor:
- Losing access to key financial accounts or platforms.
- Confusion around the status of investments or insurance policies.
- Lack of documentation or oversight during the transition.
5. How to Prepare for a Smooth Transition
Whether your advisor is part of a one-person practice or a larger firm, it’s always wise to prepare for changes. Here’s how you can take control of the process:
Proactive Steps You Can Take:
- Start early: If you suspect your advisor might retire, start asking questions now.
- Organize documents: Ensure you have access to all essential files, passwords, and portfolios.
- Seek referrals: If you’re working with a solo advisor, ask for recommendations well before they step down.
- Communicate regularly: Stay informed about any upcoming changes.
- Adjust expectations: Whether it’s financial or professional, give yourself time to adjust after a transition.
6. How to Find a Financial Advisor
Embrace this as an opportunity to reassess your goals and embrace fresh perspectives. But you shouldn’t have to shoulder the burden of rebuilding your financial strategy from scratch.
Set yourself up for future success and find a fiduciary financial advisor who operates under a team approach. The only thing worse than navigating the retirement of your financial advisor is doing it twice!
Why a Team Approach Makes a Difference:
- A Team Approach Creates Stability: Your relationship is with the firm, not just one advisor. Every client benefits from a collaborative approach where multiple advisors are familiar with your plan. Even if your primary advisor retires, another team member can step in—already up to speed on your financial goals and preferences—so your progress stays on course.
- Specialized Advisors Keeps Things on Track: A multi-advisor firm eliminates these “black hole” gaps. With a team already familiar with your plan, another advisor can step in seamlessly.
- A Salaried Team Adds Value: With a firm that employs salaried advisors, your financial management won’t be interrupted by retirement. Salaried advisors are focused on your success—not commissions—so your goals remain the priority. Plus, you’ll always have someone ready to answer questions or provide guidance, even during periods of transition.
- Working with a Team Eases the Transition: When you work with a team-based firm, most of this preparation is already built-in. That means less stress for you and more time to enjoy life—no scrambling to rebuild relationships or track down important information.
Read more about why having a full team is better than a single advisor.
Your lifelong financial plan should be a lifelong partnership—ensuring your plan remains strong and supported, even if your primary advisor steps away.
So, instead of worrying about disruptions, you can focus on living the life you’ve worked so hard to build. With the right team behind you, every transition becomes an opportunity to move forward with confidence.