Close to half of clients (46%) are concerned about their adviser retiring, research from Investec Wealth & Investment (UK) has found.
One in five (20%) said they are “very concerned” about the prospect and 26% said they are “quite concerned”.
A large swath of advisers are expected to retire over the coming five years, while many others do not intend to work late into life. Two in five (35%) IFAs say they plan to retire by the time they turn 50.
The study gathered responses from 535 UK consumers with stockmarket-related investments. It also revealed that on retirement of their adviser, three in five (61%) clients will retain the same firm and use another professional within the company; 31% said that they will find another adviser for themselves, and 8% said they will stop using a financial adviser altogether.
The concern over losing an adviser to retirement may be heightened by the fact that 21% of respondents said their adviser will retire within the next two years and 41% think this will happen within the next five years.
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The research also found men are much more pessimistic about losing their financial adviser than women, with more than half (52%) of men saying they were either very concerned or quite concerned about the prospect of their adviser retiring, compared to 25% of women.
Nick Vaill, senior investment director at Investec Wealth & Investment (UK), said: “It is entirely understandable that clients often find themselves worrying about what will happen to their financial investments and affairs when their adviser retires. They are concerned about losing the personal attention and expertise they have come to rely on and are worried that any change in personnel could disrupt the continuity of their investment strategies that have been put in place.
“However, retirement is part of the natural course of life and most financial advisory organisations will have succession plans in place to ensure the smooth transition of a client’s financial assets to another qualified professional.
“We have seen the importance of advisers implementing a centralised investment proposition and working in conjunction with a discretionary fund manager to better facilitate the sale of a business or hand over to a new adviser. Advisory models do come with additional administrate burdens and costs which may put off potential acquirers.”
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