Succession planning is not just a North American advisor problem, nor is it an issue confined to the UK. Across the financial advisory landscape, both independent financial advisers (IFAs) in the UK and financial advisors in the U.S. and Canada are grappling with the same reality: the majority recognize the need to plan for their exit, but far too few are taking action.

Recent research by ValidPath in the UK found that while 31% of IFAs see succession planning as “vital,” a staggering 36% of those planning to retire within ten years admit they have given “little” or “no” thought to their succession plans. Similarly, McKinsey reports that in the U.S., the financial advisory sector is bracing for a severe talent shortfall, with projections indicating a shortage of up to 100,000 advisors by 2034.

The Same Problem on Both Sides of the Atlantic

The advisory industry on both continents is aging. In the UK, a quarter of IFAs looking to retire within five years still do not treat succession planning as a core business priority. Meanwhile, in the U.S., 38% of advisors—who collectively manage 42% of total industry assets—are expected to retire in the next decade, outpacing new entrants to the field. Without proper succession planning, firms risk value erosion, client attrition, and a lack of continuity that could jeopardize hard-earned relationships built over decades.

Why the Delay?

Both UK and North American advisors cite similar reasons for postponing succession planning:

• Perceived timeframes: Over half of IFAs in the UK believe five years is enough to plan for an exit, mirroring a common misconception among North American advisors who underestimate the time required to successfully transition a business.

• Lack of viable successors: In both markets, firms struggle to attract younger advisors willing to take over established books of business. McKinsey highlights that wealth management firms in the U.S. have not been recruiting at a pace necessary to replace retiring advisors, leading to a growing capacity gap.

• Fear of business disruption: Many advisors worry that planning for succession might signal instability to clients, yet the reality is that failing to plan leads to a more chaotic and less profitable transition.

The Urgency of Action

The similarities between the UK and North American markets make one thing clear: this is an industry-wide challenge that requires proactive solutions. Advisors must start treating succession planning as an integral part of their business strategy, just as they advise their clients to plan for the future. For enterprises and large firms, this is an opportunity to step in with structured succession solutions, recruitment programs, and AI-driven talent calibration tools to help match potential successors with retiring advisors.

As ValidPath CEO Angus MacNee aptly put it, "The good news is that most IFAs understand why succession planning is important, but only 9% currently treat it as a central part of their strategy." The same applies across the Atlantic, where strategic succession planning is no longer a luxury—it’s a necessity for the sustainability of the industry.

If the wealth management sector is to thrive globally, advisors, firms, and enterprises must take coordinated action now to bridge the generational gap and ensure a smooth transition for clients, businesses, and the next wave of financial professionals.