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Most high-performing advisors have succession plan

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Financial advisors are enjoying the highest assets under management and compensation levels since 2007, but many of them are failing to position themselves for future success, according to new research.

Fidelity Investments released this finding in its “7th Fidelity Advisor Insights” study, which uncovers key strategies of high-performing advisors – individuals with an above average percentage of their clients’ investable assets, growing assets under management and high career satisfaction. Fielded in August 2013, the research polled 813 advisors who work primarily with individual investors and who manage $10 million-plus in individual or household investable assets.

According to the study, 95 percent of advisors grew their books of business in the last 12 months. Their average assets under management total $62 million and average compensation is pegged at $240,000.

Among the study’s additional findings:

  • 63 percent of high-performing advisors have formal career goals and they are more likely to have a business continuity and succession plan;
  • 42 percent of high-performing advisors target Gen X/Y investors compared to 17 percent of other advisors;
  • High-performing advisors are also nearly twice as likely as other advisors to ask less profitable clients to leave the firm. And they are more than twice as likely to target high-net-worth investors;
  • Two-thirds of advisors do not have a multiyear plan in place, and nearly half do not set formal career goals for themselves;
  • 43 percent of advisors do not believe that revising their practices to meet the needs of younger investors is important;
  • Two-thirds of advisors believe they stand out from the competition by giving clients personal attention;
  • 66 percent of advisors do not have a multiyear plan in place, and more than one-third do not have a business plan at all; and
  • Only 21 percent of advisors see teaming as a differentiator, while 64 percent believe that technology increases value to clients, only 35 percent are willing to spend money on it.


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