For many advisers, the focus is on day-to-day: client meetings, renewals, compliance, portfolio reviews — the constant rhythm of being in the business. But what if you paused long enough to ask yourself: “Am I building a practice, or just running one?”
The truth is: starting succession planning in your 40s doesn’t mean you want to leave tomorrow — it means you’re making a choice to build a practice that can thrive whether you’re there or not.
The “Working On the Business” Mindset — Applied Early
Most IFAs wait until their late 50s or 60s to consider succession. But by then, structural weaknesses — data gaps, client concentration, owner dependency — are baked in. Waiting often means less control and fewer options when time pressures surface.
Start in your 40s and you give yourself real time to:
- Clean up your data and systems — making your revenue, client mix and growth history clear and credible.
- Diversify income streams — shift progressively from once-off commissions to recurring revenue, reducing reliance on sporadic highs.
- Build internal capacity or groom a successor — rather than rushing to sell to a stranger because you left it too late.
- Strengthen client relationships beyond yourself — making sure clients stay even if you eventually step back.
That way, in 5 or 10 years, when you do decide to sell, you’re negotiating from a position of strength — not urgency.
Why Your 40s Are The Smart Time to Act
Your 40s are often your most dynamic — energy is high, ambition strong, and many structural levers are still within reach.
At this stage you can:
- Optimize your growth curve — compounding book value and income over time.
- Patch structural risks — like over-reliance on a few clients, or seasonal/revenue dips.
- Position yourself for long-term flexibility — whether that means merging, handing off to a successor, or simply building a legacy.
In short: you’re building, not winding down.
It’s Not About Leaving — It’s About Building Optionality
Succession planning in your 40s isn’t a sign you’re giving up. It’s a strategic move. Think of it as corporate-grade risk management and future planning:
Illness, burnout, family life, regulation changes — unpredictable events don’t wait for you to be “ready.”
- Having a robust succession plan gives you and your clients peace-of-mind: continuity, stability, and a stable experience even if life changes.
- And when you choose to exit — voluntarily or otherwise — you’ll do it with control, not desperation.
What This Means for Your Practice Today
If you take nothing else away — begin to treat your IFA practice as a long-term, scalable asset, not just a day job.
Start small. Begin with a quarterly “business review” slot in your calendar. Review your client mix, income streams, bottlenecks and dependencies. Document who does what. Think about who could someday take over.
Over time, these small steps compound. What starts as a bit of housekeeping becomes structural strength.
When you do eventually choose to sell — or hand over — you’ll have a practice that works without you. A practice that commands respect. A practice that counts for real value.
Final Thought
You don’t start succession planning because you want to exit immediately.
You start because you value optionality. Security. The freedom to choose when and how you step back — on your terms, with maximum value.
If you wait until you “feel ready,” you might find the market — or life — chooses for you.