“We do property planning for our purchasers, we must be doing property planning for our companies,” Harnum provides.
Whereas Cornacchia has a long-term settlement with Harnum, he has additionally bought one other e book from a unique advisor, with a one-year time horizon. That shorter turnaround time, he explains, took a major quantity of labor upfront, however with applicable assist and sufficient time to construct shopper relationships it was profitable. He and Harnum agree that shorter timeframes than a yr for succession change into very difficult to handle. A tougher transition might lead to far decrease shopper retention and satisfaction charges.
It additionally helps a fantastic deal when the promoting advisor is ready to stay in some form of consultancy position for a time frame, serving to with the transition of their most advanced purchasers to the brand new advisor. Harnum defined that even after she transitions a few of her purchasers to Cornacchia’s care, she is going to attend shopper conferences for the following yr or so to assist handle extra advanced circumstances.
What’s key to any succession plan is alignment between the customer and vendor on the form of apply they need to have. Advisors who share a philosophy round monetary planning, service choices, and funding administration may have a far simpler time transitioning from one aspect to the opposite. A massive apply or excessive revenues could appear interesting, nevertheless it’s essential to look underneath the hood and decide an advisor’s fashion and the age combine and asset mixture of their purchasers.
Due diligence is a key facet of any sturdy transition plan. In that course of Harnum says that documentation is essential. Handshake agreements and good conversations can lay the groundwork, however with out sturdy documentation and full phrases articulated in writing there may be house for confusion, which might influence the success of any succession.
