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'Dying at your desk' is no succession plan

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Many advisers are fond of saying that they expect to die at their desks.

When such a plan isn't paired with a fully realized succession strategy, Tim Chase, a CFP and co-founder, partner and chief executive of WMS Partners, isn't amused.

"My honest opinion is I think that's a sh---- way to treat your clients," says Chase, whose Towson, Maryland, firm, manages $3.4 billion in client assets.

Even if an adviser tries to soften the blow by leaving behind client referrals to new firms, it still isn't enough, he says.

"It's like, 'Keep dating me up to the end. When I die, here are the names of three of my friends, and maybe you would like to date them, but I'm never going to marry you," Chase says.

Like commitment-phobic bachelors or bachelorettes everywhere, many advisers are incapable of planning for succession because they founded their firms to live and work like mavericks and have become trapped in that role, Chase says.

"If you really aren't willing or able to work with others, you probably need to seek counseling," he says. "I don't mean that in a harsh way but in a positive way."

The problem could be factoring into statistics such as one last year from an Advisor Group survey of 744 advisers, which found that more than 80% of them said that they didn't have a written succession plan.
The failure of so many advisers and firms to plan for futures beyond their founders is a well-recognized problem, given that there aren't enough younger planners entering the profession to replace those who are exiting.

There are manifold benefits to hiring and cultivating partners who will improve a firm's performance and value, not only in the long term when it comes to an M&A deal or a gradual transition of power but immediately, Chase says.

"The beauty of partnership is that your partners will hold you to account, and your clients are better off for that," Chase says. "When you are a sole proprietorship and no one is there to hold you [to] account, that is never in your client's best interest."

Over the 25 years that Chase has guided his firm's growth from him and his co-founder up to 58 employees and 15 partners, he says that he constantly sees the benefit of additional input but only because he takes pains to hire the best people.

"It's with client relationships, it's with investments, it's coming out of a meeting when I said the wrong thing to the client and they say, 'Hey, you dummy, what did you say that for?'" he says.

And, ultimately, it is about knowing your clients will be OK, even if you "marry" them and, then -- like all spouses do one day -- kick the bucket, Chase says.

"I'd like to think my clients would miss me. But I'm not really the key on any client relationship anymore, so I can honestly say if I got run over by a bus tomorrow, there are not a lot of clients that going to be adversely impacted," Chase says.

This is part of a 30-30 series on smarter succession planning.

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