KEY QUESTIONS

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Financial planning is a journey and not a one off-event. As a financial planning expert, you have a fiduciary duty to yo
KEY QUESTIONS 12 JUNE 2017

HOW DO I PLAN MY SUCCESSION? BY JEAN ARCHARY, BUSINESS MANAGEMENT SERVICES, OLD MUTUAL WEALTH

12 JUNE 2017

WEALTH INTELLIGENCE WEEKLY KEY QUESTIONS



A suitable successor is one who buys into your vision and philosophy. It is the person who has a similar passion for financial planning as you do, one who will get along with your clients

HOW DO I PLAN MY SUCCESSION?

and take care of your employees. It is imperative that the successor you have identified has actually agreed to the terms and conditions of your succession plan. Appointing a family member who does not have a similar passion for financial planning, will not be beneficial to your employees or clients. •

The people in your business have played an instrumental role in helping you achieve your objectives and deliver on your

As a business owner, you’ve invested a lot of time, resources and

proposition. It is important that they are made aware of what

effort to create a sustainable and profitable business. It took years

will happen during succession and the role they are required

of hard work to build your brand and create a lasting legacy,

to play during the process. New ownership or a sudden change

developing a team and aligning resources supporting meaningful

in leadership can bring about uncertainty and employees may

relationships with your clients. It is important, however, to also put

feel threatened. Early communication can help reduce this

in the time and effort to plan your succession.

uncertainty.

At some point in our lives, we will all face old age; retirement;



behaviour, so it is absolutely essential to provide clients with

disability or illness and eventually death. That is also what we teach

peace of mind knowing that their financial plans and investments

our clients - to plan for our financial goals and protect ourselves

are secure. The transfer of client relationships is key to the success

against worst-case scenarios.

of a succession plan specifically for a financial planning business. How well this is managed will depend on comprehensive

Financial planning is a journey and not a one off-event. As a financial planning expert, you have a fiduciary duty to your clients to ensure that they achieve their financial goals. Your employees are also playing an instrumental role in helping you achieve your business objectives. This compels you to make certain that continuity is provided for both your clients and employees for when you are no longer around and that the transition from dealing with you to someone else is a smooth one. Succession is an integral component of business planning and requires that you plan ahead for the day you walk away from your business, be it voluntary (retirement or resignation) or involuntary (death or disability). Here are some points to remember when planning for your succession: •

A succession plan has no value if it has not been documented. We all know what the implications are for beneficiaries when clients die without a will. A documented plan will ensure that



We are familiar with the impact emotion has on investment

planning, a smooth transition and effective communication. •

Your loved ones have also played an integral role in helping you build your business. They may have been a part of your business and need to be included in your succession plan. Take care of personal matters and ensure that your dependants are aware of your succession plans.

Although there are a number of considerations, succession planning needs to be high on your list as a business owner. Growing old is not something that is likely to disappear and death is an inevitable part of life. Avoidance leads us to postpone important matters for when we have more time and, because of our hectic schedules, it never gets addressed. So if you would like your clients to remember you for helping them to plan and achieve their dreams, make sure that this is evident in your succession planning.

everything is in order from a legal perspective and that there

To help you identify gaps in your succession planning, we have

are no hidden surprises.

developed a Succession Planning gap analysis that will assist you

A succession plan outlines the processes that need to kick in

to identify the actions required to start compiling your succession

for the various events that trigger off a succession. For example,

plan. Log in to www.knowmore.co.za and you will find the

death will require a different set of actions as opposed to

gap analysis under the Tools tab. You will be able to implement these

succession triggered by retirement. A comprehensive plan will

actions together with your business coach.

provide guidelines to your successor regarding the actions that need to take place when certain succession events are triggered.

Old Mutual Wealth is brought to you through several authorised Financial Services Providers in the Old Mutual Group who make up the elite service offering. This document is for information purposes only and does not constitute financial advice in any way or form. It is important to consult a financial planner to receive financial advice before acting on any information contained herein. Old Mutual Wealth and its directors, officers and employees shall not be responsible and disclaims all liability for any loss, damage (whether direct, indirect, special or consequential) and/or expense of any nature whatsoever, which may be suffered as a result of or which may be attributable, directly or indirectly, to the use of, or reliance upon any information contained in this document.