Recently, my colleague Sayok visited Delhi to meet a few partners, where he encountered a deeply unfortunate story. A gentleman (in his early forties) had passed away, and in a matter of weeks (a few months at best), everything he had built disappeared—his clients were gone, his assets under management (AUM) evaporated, and his business crumbled. This isn’t just a tragic tale; it’s a reality for many financial professionals who overlook the importance of succession planning. It’s a stark reminder that without a clear, actionable plan in place, the legacy one works so hard to create can vanish overnight.

This story is not an isolated incident. In fact, studies show that over 90%, rather the number is as high as 99% of financial practices fail to survive their founder’s retirement or end of career. This is not just a statistic; it’s a wake-up call for the industry. The truth is, without a well-thought-out and properly executed succession plan, most practices are doomed to fade away with their founders.

Why is this happening? It’s because many operate with the belief that succession is something that will “fall into place” when the time comes. They assume that when they are ready to step back, someone—perhaps a junior team member, a colleague (or an industry colleague known to them), or even a family member—will take over seamlessly. But this is a flawed assumption. It ignores the complexities of transitioning a business that relies heavily on one individual’s relationships, skills, and vision. A business built on a single person’s expertise cannot simply be handed over without a strategic approach.

A Huge Problem That Needs Solving

The failure of so many practices to outlast their founders is a massive problem, not just for the financial professionals themselves, but also for their clients. Clients place their trust in you, often for decades. They expect continuity and stability. When you retire or exit without a solid plan in place, clients are left vulnerable. They might be handed off to someone they don’t know or, worse, forced to find a new financial professional altogether. This disrupts the client’s financial journey, creates mistrust, and damages the very fabric of the advisor-client relationship.

This isn’t just about losing a business; it’s about failing the clients who have relied on you for years. It’s about letting down the people who have trusted their life savings to someone who wasn’t prepared for the inevitable. This is a responsibility that should not be taken lightly.

Are You Among the 90% or the 10%?

The question you must ask yourself is: “Am I among the 90% who risk losing everything upon retirement, or am I part of the 10% who actually plan for the future?” The 10% who successfully transition their businesses don’t leave things to chance. They are proactive. They identify successors early. They invest time and resources into training and mentoring them. They build a culture and structure that allows the business to operate without their daily involvement. They create systems that ensure clients receive the same high-quality care, no matter who is at the helm.

If you’re a financial professional who’s nearing retirement or even if you’re decades away, the time to act is now. Succession Planning isn’t something that should be left for the final years of your career. It’s a long-term process that requires building the right foundation today. It’s about transforming your practice from a one-person show to an enterprise that delivers value, even in your absence.

Taking Action: The Path to the 10%

To be among the 10%, you need to embrace a new mindset—one that views your business as an entity independent of yourself. Here are some critical steps you can take now:

1. Evaluate Your Current Team: Look at the people within your organization. Is there someone with the potential to take over? Is there a junior team member who shows promise? If you find someone with potential, start investing in their growth. If not, start searching outside. In any case, don’t do this alone. There is help available. Building and mentoring a successor is a time-intensive process, and it’s never too early to start.

2. Create a Scalable Business Model: A practice that relies heavily on one person cannot thrive beyond that person’s departure. You need to create a scalable business model that functions independently of you. Focus on developing systems and processes that allow your business to operate efficiently without your daily involvement.

Think about ways to scale your services. Leverage technology to create consistency. Develop a team that can deliver a client experience that doesn’t rely solely on you. Your clients should feel taken care of, whether it’s you or someone else in the firm they interact with.

3. Document Your Processes and Client Relationships: One of the biggest hurdles in succession planning is the transfer of knowledge. Your expertise, approach, and methods are unique. They are what set your practice apart. However, they also pose a risk if they’re not documented.

Create a detailed playbook that outlines everything from how you handle client meetings to your approach to investment decisions. Include client-specific details that will help your successor build rapport with your clients. This documentation will be a crucial resource when you step away.

4. Establish a Clear Succession Plan: Succession planning is not just about identifying a successor; it’s about outlining the entire transition process. Put your plan in writing, with all legal and financial considerations clearly outlined. Define a timeline for when your successor will take over and how the transition will be managed.

Make sure your plan is reviewed and updated regularly. A succession plan (like a will) isn’t static; it needs to evolve as your business and team grow. This plan should not only address who will take over but also detail the training, strategies, and support needed to ensure a seamless transition.

5. Communicate with Clients Early: Client communication is crucial. Don’t wait until you’re on the brink of retirement to introduce your successor. Start the process early. Slowly integrate your successor into client meetings. Build their presence in your clients’ lives so that when the time comes, it feels natural.

Clients should see that your practice is more than just about you. Show them that it’s a legacy designed to last. This builds confidence and trust in the transition process. It reassures clients that their financial future remains secure.

Choose to Be Different

Succession planning isn’t just about securing your retirement. It’s about creating a legacy. It’s about protecting the people who have trusted you with their most precious resources—their time, their dreams, and their money. It’s about ensuring that your business, and the impact you’ve made, continue long after you’re gone.

The truth is, the 90% who don’t plan will face the inevitable consequences. Their businesses will dissolve, their clients will feel betrayed, and their life’s work will vanish. But you have the choice to be different. You have the choice to be among the 10% who take action, who build a legacy that goes beyond themselves.

Real financial professionals who plan for succession are not just securing their business; they are protecting their clients and ensuring that the trust they’ve built remains intact. This is a responsibility that goes beyond numbers; it’s about the impact you’ve had on your clients’ lives. Are you willing to do what it takes to protect that?

The path to the 10% is not easy, but it is possible. It requires foresight, effort, and a willingness to invest in the future. Take the time now to create a strategy, build a team, and establish a plan. You owe it to yourself, your business, and your clients. Be among the 10%. Protect your legacy.

The question is: will you be among those who prepare, or will you leave your legacy to chance? The choice is yours.