Survey highlights gaps in succession preparedness, Executive VP explains why the issue persists
It’s perhaps one of the great ironies of the advisory business in 2025 that so many members of a profession built around preparing Canadians for their retirement have not formally prepared for their own. A recent study by the Investment Planning Counsel (IPC) drove home that very irony, interviewing clients about the value of retirement planning and interviewing advisors about the state of their own succession plans. While 91 per cent of clients say that retirement planning is important, 81 per cent of the advisors surveyed by IPC said they do not have a succession plan in place.
John Novachis believes this gap can jeopardize client trust, as well as lay serious future risks for advisors and their families. Novachis is Executive Vice President, Advisor Growth and Succession at IPC. He explained why so many advisors have not grappled with the work of building a plan for themselves and outlined the risks that this presents to them. He highlighted, too, some of the measures that firms might be able to take to support better advisor succession planning in a period where continuity of advice to clients and advisory teams are paramount.
“There are trillions of dollars transitioning from one generation to another generation. Baby boomers are key in that process, they were the generation that created much of that wealth now moving to the next generation,” Novachis says. “Baby boomers are more risk averse, they’re going to ask who will be looking after the money when they’ve gone. They want to know that there is continuity.”
The survey explored some of what has held advisors back from developing their own succession plans. It notes that 80 per cent of advisors feel hesitant about succession planning overall, with 27 per cent of those saying they don’t know who to trust, 26 per cent saying they are sad to lose client connections, and 25 per cent saying they are uncomfortable with the idea of their career ending.
Novachis believes that this career is more a vocation than a simple job. Confronting the idea of leaving one’s calling, therefore, can be extremely daunting. In making a succession plan advisors have to face their fears about who will take care of their clients and whether their employees will be okay. It could be easier for advisors to tell themselves they need to stay in their role, perhaps to ride through this latest round of market volatility, or to make sure clients and employees are cared for. Novachis emphasizes how deeply emotional the first stages of succession planning are.
At the same time, he notes that there is a window of opportunity here. There are new pathways, he notes, for advisors to monetize their practices and ensure the succession of their practices without having to stop work entirely. At the same time, he notes that the mass retirement of baby boomer advisors is ongoing. Given this industry’s demographic skew towards older advisors, the market may soon flood with books of business while the viable buying cohort remains small. Basic economics dictate that the price for practices could very likely fall in the coming years, adding a degree of urgency to the succession planning process.
Notable groups of advisors that are more likely than average to not have a succession plan include Millennial advisors (25%), and advisors who work on their own (23%) as opposed to working on or managing a team.
When asking advisors the biggest barriers to starting succession planning, the survey found generational differences. Millennial advisors are more likely to say they are too young to start (70%), Gen X are more likely to note they are too busy and/or have other priorities (32%), while Boomers indicate not wanting to raise concern among clients/staffs (35%), not knowing how to accurately value their practice (33%), and lack of access to additional expertise (20%) as barriers.
Novachis notes that some advisors might not need or be ready to build out a full succession plan as of now. In those cases he argues that they should look at business continuity plans as they start to form their more formal succession plans. Business continuity plans can help mitigate against some significant risks while laying the groundwork for more formal succession planning work that could be done later in an advisor’s career.
Read more: Inside a 15-year succession plan | Wealth Professional
Much of the responsibility for encouraging advisor succession plans rests with advisor firms, too. Novachis believes that firms can help manage the succession crisis by building robust pipelines of young advisory talent capable of taking on the retiring generations’ clients. Encouraging those advisors may require reconsidering compensation and cashflow models to keep talented young people in the business during periods when traditional compensation models may feel less attractive.
“To me, the key is we need to bring in and create the tools and support structures for those younger advisors to be able to take over those senior advisor practices,” Novachis says.
