I recently ran across a couple of statistics about how financial advisors treat their own business and it’s place in their personal planning that I find to be troubling and indeed somewhat shocking for a business group that is founded on the core principles of planning: setting goals and building plans to reach those goals.

According to the 2008 FPA-Cerulli study:

• Over half of respondents are over 51 years of age (and thus presumably, people who should be seriously thinking about their own “retirement”.
• Nearly half of respondents estimate the value of their business will be greater than $1 million – and thus, presumably one of their largest (if not the largest) financial assets that will support them in retirement.
• Half of respondents don’t have a written plan to manage the factors that can increase the market value of their (presumably) largest financial asset prior to their retirement date.

The old folk saying about the cobbler’s children having no shoes comes to mind when I think about this situation.

Based on my inquiries and discussions within the financial services community, the most common answer to the question of “why don’t you have a business ownership transition plan?” is that people see it as “important but not urgent”. In other words, they saying “I’m too busy running a business now. I’ll think about this stuff later.”

Too many of our clients at Whitewater Transitions are evidence of this failure to plan, coming to us when they’re at the door of the emergency room, so to speak. Unfortunately, no one can turn back the hands of time – and time is the critical element in planning, isn’t it? As it is in building a retirement plan or a college funding plan, the power of time to facilitate the intention to change is non-replaceable. Use it or lose it really is true, whether it’s building investment portfolio value or building the open market business value of your company or practice.

Isn’t it about time that we become better cobblers and give our kids some good shoes?

What do you think?

Posted in Doing the Deal, Getting Ready, Uncategorized

Leave a reply ↓