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In Practice July 29, 2025
Who’s On Deck? Solving the Succession Planning Crisis at Advisory Firms
Advisers too often risk ‘both value and continuity’ out of attachment to the business and aversion to change.
Reported by Rhea Wessel
Art by Silvia Casanova Fenollosa
It’s no secret that the retirement plan advisory industry is aging fast. Assets are growing and client needs are becoming more complex, but the pipeline of new financial professionals is not keeping pace. In fact, the U.S. faces a “looming” wealth management adviser shortage, which could reach 110,000 by 2034, according to a report from consultancy McKinsey & Co.
According to the report earlier this year, a combination of demographic shifts, licensing hurdles and waning interest among younger recruits has left many firms without a clear line of succession.
The irony?
The very professionals who guide plan sponsors through long-term planning often avoid doing that planning for themselves.
Despite strong valuations for advisers’ firms, plenty of M&A activity and a deep pool of available private equity capital, succession planning remains largely theoretical at many practices. As one expert put it, the profession is full of “alpha decisionmakers” who refuse to make this decision.
“You see it over and over again,” says Leigh White, a Certified Exit Planning Advisor and co-founder of Myriad Advisor Solutions, which supports advisory firms with compliance, operations and transitions.
“The business owner has built this book over 20 years, maybe more,” White says. “But they’ve tied the entire value of the firm to their personal relationships with clients. They say they’ll never retire—and then a crisis forces the issue.”
White speaks from experience. After founding multiple companies, she sold her first business emotionally, in haste and without a plan.
“I was tired. I was reacting,” she says. “A year later, I had done everything on my bucket list, and I was bored—and full of regret. I didn’t think about what I was walking into, only what I was walking away from.”
Fast-forward to 2021: White was diagnosed with breast cancer just as she was beginning to consider a formal succession plan for Myriad. Her daughter Danielle, who had been gradually stepping into a leadership role, was suddenly leading the company.
“She was better than I was,” White says. “Many of our clients didn’t even know I was sick. That’s how you know you did it right.”
That kind of seamless transition is still rare in retirement plan advising, White says, especially among small, founder-led practices. Whether due to emotional avoidance, cultural resistance or practical obstacles, many advisers remain stuck in the planning phase or avoid it entirely.
Emotional Blind Spots
Sara Celotto is a fractional chief operating officer and founder of the Vision Catalyst, where she helps entrepreneurs build the systems, structure and succession plans they need to grow and eventually step away. After more than a decade in estate and business law, she’s seen first-hand how seasoned professionals struggle with planning their own exits.
“Advisers don’t just sell a service—they sell a relationship,” Celotto says. “That makes the transition deeply personal, and that also makes it fragile. Clients can leave at any time. So if a successor doesn’t feel like an extension of the original adviser, you risk losing everything.”
One of the most common blockers Celotto sees is the idea that thinking about succession is akin to thinking about death—something professionals trained in risk management still shy away from.
“It’s superstition, it’s control, it’s ego,” she says. “They don’t want to believe their business is better off without them.”
Celotto recalls one advisory firm in which a senior partner failed to secure loyalty from junior colleagues and eventually lost not only his book of business, but the team and infrastructure with it.
“It wasn’t just a walkout—it was a full-scale collapse,” she said. “There was a legal battle, yes, but the damage to the business was immediate and real. It didn’t have to happen that way.”
Planning Without Committing
For advisers who understand the importance of planning but are not ready for a full exit, there are growing options that offer flexibility.
“Not every succession needs to be a sale,” says Michael Mufson, an investment banker who specializes in liquidity events for privately held firms. “There are ways to de-risk and stay involved.”
The most common of those structures is a majority recapitalization, in which the owner sells a controlling stake—often to a private equity partner—but retains a meaningful minority share.
“They might go from owning 100% to 35%,” Mufson says. “They get a liquidity event, they stay involved in the business, and the staff may not even notice the transition. It’s much smoother than a full sale.”
Mufson noted that private equity is sitting on massive dry powder earmarked for these types of deals—and that valuations for advisory firms are currently strong.
“What we’re telling owners is: Explore your options now,” Mufson says. “The window may not stay open forever.”
Still, many advisers hesitate. Some want more time to “clean up” their books or automate operations before seeking a buyer or naming a successor. Others have no clear idea who that successor might be—and no process in place to identify one.
The Sector’s Unique Challenges
Advisers serving institutional retirement plans face a unique vulnerability: Plan sponsor relationships are subject to periodic review and may not be contractually secure over the long term. That introduces client retention risk—particularly during or after a leadership transition.
“If the relationship is only with you, and not with your team or brand, you might lose that account after a transition,” says White.
To mitigate that risk, White says firms should institutionalize their client relationships by involving junior staff in sponsor interactions, automating communications and standardizing advisory processes.
“The more you can show that your business runs without you, the more valuable it becomes,” she says.
That also applies to firms that plan to transfer ownership internally—to the next generation of advisers, co-founders or family members, sources agree. Without a formal handoff plan, a buy-sell agreement and clear ownership structure, even the most collegial team can unravel during a transition.
Start Somewhere
For owners not yet ready to sell—or who do not have a successor in mind—White recommends what she calls the “stay-or-go” process. First, conduct a business valuation. Then decide: Do you want to sell now, or improve first and sell later?
“Even those first few steps are incredibly clarifying,” she says. “Once you see the value of the firm—and what might raise it—you can make smarter decisions about the timeline and the structure.”
Those who put off planning entirely risk both value and continuity, she continues.
“A family member might have to step in with no knowledge of the business. Clients and staff might leave. The courts could get involved. You don’t want that,” White says. “Succession planning doesn’t have to mean you’re stepping away tomorrow. It just means you’re protecting what you’ve built—for your clients, your staff and your legacy.”
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