Half of all advisors figure they have less than 15 years left in the business and a full 62% either have a succession plan in place or are working on it.
But drill down into the latest TD Ameritrade survey of advisors and you'll find that a lot of the succession planning is actually motivated by the desire to prove to clients that their long-term needs will be met.
"Satisfy client expectations" is by far the top motive for advisors who have made a succession plan, and its weight in the overall mix grew sharply over the last year.
But more personal career-oriented motives -- like "provide smooth transition into retirement" -- lagged significantly.
Furthermore, these plans seem a little nebulous. Half of them simply assign an advisor's practice to an internal successor, which is not terrible, but may not be completely realistic.
It's like your clients assuming their kids will take over the business when they retire.
More honest: the 19% who expect to sell or combine with another firm when they leave the industry, not to mention the 30% who have no real idea what will happen to the business when they're gone.
In the meantime, a full 33% of advisors want to hire new talent in 2012, mostly junior advisors who can provide client service and build relationships.
In other words, they're still looking to grow their AUM, and not so much to groom the next generation of leaders.
Sure, most of the advisors TDA surveyed say they "informally" mentor younger advisors. But "networking" and "internships" are often code for looking for recruits currently working at other firms and bringing in cheap help to handle the gruntwork, respectively.
These are not necessarily kids we're talking about, but "Gen X and Y" -- men and women in their 30s and 40s.
In ten to fifteen years, they will be roughly as old as today's advisors are now. And half of today's advisors will be out of the industry, or on the edge of leaving.