I was talking with a client recently and was reminded of how important a business succession plan can be. My client called to talk to her trusted personal banker at the local bank. She was told that he had retired. She was directed to a replacement banker and she left a voice mail. A week later she had still not gotten a call back.
If you have a relationship with a great financial planner, do you know what happens in the event they can’t come to work tomorrow? It could be a skiing accident, a mother in hospice care, a stroke or a bout with cancer. In any of these cases, your trusted advisor might not be able to assist you for a few weeks, or maybe forever. What happens to you then?
Planning for the worst
As regular readers of this space may recall, I buried my father this summer and had several close friends struggle with health challenges over the last year. These events are not unusual. They happen all the time. But they’ve reminded me of my responsibility to provide for my clients in the event some unexpected event prevents me from working.
I love being a financial planner and I plan to do this work for another 20 years or more. However, I’m reminded that none of us knows what the future holds. That’s why I have taken steps to assure that my clients will be well served whatever happens to me.
It’s a great idea to discuss this matter with your trusted advisors. It could be a financial planner, an attorney, a tax professional or a business coach. If you count on these professionals to assist you with important areas of your life, and you would miss them if they are gone, it’s a good idea to understand what will happen, just in case.
How should I pick a new financial advisor?
My area of expertise is financial planning. I suggest that your planner have an experienced well-trained professional with the very highest integrity identified, by name, to step in for them if necessary. As you know, I’m a big believer in the CERTIFIED FINANCIAL PLANNER™ credential. I think a successor financial planner really must be a CFP® professional. It’s the baseline training for a serious financial planner.
Having the person named means that all parties have agreed to this arrangement and your transition will be smoother as a result. The alternative is for the registered investment advisor (RIA) or brokerage firm that supports your advisor to search for a replacement after your planner is out of the picture. It will create a delay and could make it a little harder for you to get assistance during the handover.
As you discuss plans with your current financial planner, I suggest you discuss a couple topics:
- Is the successor advisor always the client’s advocate – a fiduciary advisor?
- Is the advisor only paid by clients, not any financial product manufacturer or distribution network? That would be a fee-only advisor.
These two points help assure that you are working with a professional who is committed to your best interest at all times. It seems sort of obvious to me that a professional would work in this way, but it’s not automatic.
A fiduciary, fee-only, CFP® professional can help you make great financial planning choices and develop a comprehensive financial plan that is driven by your goals and priorities and addresses all aspects of your financial life. With a big-picture approach, you will be better prepared to understand your options at every step along the way.
Yes, I am a CFP® professional. I’m always a fiduciary and I only work on a fee basis. And yes, I’m still taking on a few great families to be part of my financial planning practice.
If this article has you thinking about your own circumstances, contact my office at rdunn@dunncreekadvisors.com. I am always happy to meet with people who are working on their retirement plans. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.
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