Financial Planning Business For Sale

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Sadler and Garcia had collaborated on some small accounts in the past. Months of work and hundreds of client meetings followed.

By mid-2014, Sadler retired and Garcia's AUM jumped to $225 million (it's $260 million today) from about $105 million.

A huge number of clients will mean more work during the transition.

Mark Heiden, an advisor at Wedbush who's bought two books of business from retiring advisors, notes that clients' personalities are often a reflection of the broker they work with."If you are buying a book from a really nice guy, his clients are likely to be like him," says Heiden, whose AUM has grown to about $300 million from $200 million.

Taking into account factors such as these, a typical price is around 100% of trailing T12 production, advisors say.

PAYMENT PLANIn recent years, some firms have retooled their policies and made financing available to facilitate transactions.

RBC's three-year-old program has been utilized "many times," says RBC Wealth Management's Tom Sagissor, a divisional director at the Toronto-based firm.

He says the program meets the needs of older advisors not interested in signing a nine-year deal, while also enticing younger advisors to seek growth opportunities.

"It's an acquisition strategy similar to what every corporation in America does, but you've got to get advisors to think that way," he adds.

OPEN MARKETSSome industry insiders question whether employee advisors are being rewarded for the true value of their business."I would tell any wirehouse advisor looking to retire in the next two to five years to seriously consider going independent first, because those wirehouse offers are enormously tax inefficient," says John Threlkeld, an independent advisor affiliated with LPL Financial.

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