Edward Jones, in partnership with Morning Consult, released new research¹ revealing a significant gap in the future of financial advice: nearly all surveyed financial advisors recognize the importance of succession planning for their practice, yet only 42% have a fully documented, legally formalized plan in place. The findings come as Cerulli projects more than 35% of financial advisors will retire over the next decade, underscoring an urgent need for succession planning across the profession.

The survey of financial advisors points to a clear opportunity for firms to step in to provide both emotional and practical support – including firm structure, matching and guidance – to help experienced advisors pass on their practices.

 Advisors are aware of the succession gap, but few are acting

The survey shows that advisors are aware of approaching succession issues, yet too few are taking proactive steps.

• Nearly six in 10 (59%) senior financial advisors expect to fully transition their practice within the next five years.
• Four in 10 financial advisors have yet to document any succession plan.

"The numbers tell a story we hear from industry advisors every day: they know succession planning matters, but aren't doing enough about it," said Jason Henderson, principal and head of financial advisor recruiting at Edward Jones. "With so many preparing to retire, planning early isn't just a business decision, it's a commitment to the clients who've trusted you with their financial futures. The earlier an advisor begins, the more time they have to find the right successor, transition relationships thoughtfully and ensure clients are cared for after they step down."

Emotional and practical barriers make succession planning hard to start  

The survey shows a number of factors can cause financial advisors to put off succession planning — from practical concerns around valuation, timing and client continuity to the emotional weight of stepping away from a career, professional identity and client relationships they've spent years building.

What's holding advisors back:

• One in four (25%) senior financial advisors say succession feels too far in the future to prioritize.
• More than one in four (27%) senior financial advisors cite concerns about the financial valuation of their practice as a top obstacle.
• Six in 10 (61%) say finding someone they trust enough to hand their practice to is emotionally difficult.
• Nearly three-quarters (71%) agree that the complexity of succession planning has caused them to delay thinking about it.

The data suggests the barriers are as much human as they're logistical. For advisors who've invested decades in their clients and communities, succession isn't simply a transaction, it's a deeply personal transition. Addressing both the practical and emotional are essential to helping advisors move forward.

The next generation is ready to lead — but interest alone isn't enough

While senior financial advisors prepare for what comes next, the survey confirms junior financial advisors are eager for opportunities to grow; 86% of junior financial advisors are interested in acquiring or inheriting an established practice from a retiring financial advisor.

Building client relationships, finding the right match, and having the training and guidance to navigate the handoff are important pieces of bridging the gap between generations.

What different generations of advisors have to say about transition:

• Among senior financial advisors expecting to transition within the next five years, only 38% have a specific successor in mind.
• Junior financial advisors say training resources (49%), clear firm guidance and support (46%) and access to a structured matching and transition program (43%) would make them more likely to acquire a practice.

Interest on both sides doesn't automatically lead to a successful transition. The role for firms is clear: providing the structure, matching and support that create a successful handoff.

Turning succession plans into successful transitions

The survey points to an important role for firms in helping advisors navigate succession. More than a third of advisors (36%) say a checklist or starter guide would be valuable, while nearly a third (33%) point to a process for matching them with potential successors.

Edward Jones is focused on providing structural support for all of its financial advisors as they prepare for what comes next, creating opportunities for the next generation to grow and helping maintain continuity for clients. The firm meets these needs through a comprehensive approach to succession, including:

• Dedicated transition support for all advisors — from pre-transition planning through the first day and beyond, advisors work with a dedicated transition and integration manager and receive tailored support for their practice and clients.
• Teaming model — Edward Jones views team practices as an optimal way to structure a succession plan. Teaming provides flexibility and addresses the emotional complexity of succession by allowing gradual transitions where advisors maintain their client relationships while building confidence in their successors.
• Collaborative successor matching — a process that matches clients with a financial advisor best suited to their needs, with the retiring advisor playing a pivotal role in ensuring the next generation has the tools and client knowledge to succeed.
• Competitive compensation — retiring financial advisors receive base compensation of up to three times annual gross revenue, based on the past three years, with flexible payout options over two, three or four years.

"At Edward Jones, we help advisors prepare for and move through the succession transition with care," said Henderson. "When a firm is genuinely invested in both sides of the transition, everyone benefits: the advisor who's ready for what's next, the successor who's ready to grow and, most importantly, the clients who deserve continuity and trusted guidance."

For more information about financial advisor succession planning, visit www.careers.edwardjones.com.