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Best of the Blog 2019: Part II

We hope you got everything on your wish list this holiday season and that your credit card is starting to cool down from all that shopping.

We got what we wanted this year—lots of great content from our writers. Here is a continuation of the top 10 most-read posts of 2019.

In case you forgot what the first five were, see this post. Here’s the rest:

6.) Three Ways the SECURE Act Will Impact Clients with Stretch IRAs

This article by Matt Sommer of Janus Henderson Investors dove into how the SECURE Act would affect clients with Stretch IRAs. Key takeaways regarding the Stretch IRA provision include a new 10-year period for non-spouse beneficiaries, existing stretch IRAs are grandfathered, and there are exceptions to the new rules. Stay tuned to the Journal of Financial Planning’s February issue for a deeper dive into what the SECURE Act means for you and your clients.

7.) “Buying” College in the 21st Century: Clients Should Search for Colleges They Can Afford

You wouldn’t pick out your dream car and then ask how much it costs, right? Robert J. Falcon, CFP®, CPA/PFS, of College Funding Solutions, LLC, said you shouldn’t do that for college either. This information can help you help your clients figure out how to “buy” a college and pick something that will give students a good return on their investment.

8.) How to Write Like Someone Might Actually Read Your Work

FPA’s membership and marketing director, Dan Martin, lays out the writing tips that have helped him in his career, including writing like you speak, reading your work out loud and not sterilizing your work when you edit.

9.) 3 Steps to Mastering the Art of Excellence for Financial Planners

Daniel C. Finley of Advisor Solutions explores how to create excellence by continuously learning and honing your skills until excellence becomes a habit. He suggests committing to a new level of greatness, model after those who have mastered their craft and map out your milestones so you can see your progress.

10.) What You Should Know Before Leaving Your Firm

Freelance writer Sarah Li Cain penned this piece for FPA’s Next Generation Planner, an app-only publication for the next generation of financial planners, regarding the correct protocol for leaving a firm so you don’t burn bridges or do anything that could get you into legal trouble.

That’s all, folks. One more Tuesday in 2019, which means one more post, then we look forward to seeing what our writers have in store for 2020!

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Ana Trujillo Limón is senior editor of the Journal of Financial Planning and the FPA Next Generation Planner. She also edits the FPA Practice Management Blog. Email her at alimon@onefpa.org, or connect with her on LinkedIn


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Best of the Blog 2019: Part I

We’re wrapping up a decade, readers! And the last year in this decade has been another good one for the FPA Practice Management Blog powered by the Journal of Financial Planning.

This holiday season, we’re recapping the top 10 most-read blog posts of 2019 in two separate posts.

Take a look part one of the top blog posts of 2019.

1.) Are You and Your Clients Making These Estate Planning Mistakes?

This piece originally appeared in the Journal of Financial Planning’s Observer section. It recapped the top estate planning mistakes, like not having a will, only having a will, not updating beneficiaries or neglecting digital assets.

2.) Should You Include Social Security in Your Clients’ Financial Plans?

This piece, written by Mark Friedenthal, founder and CEO of Tolerisk, and Dylan Zhou, a high school senior who interned at Tolerisk, explored how to include Social Security in a client’s financial plan because while the Social Security system needs reform, it isn’t going away.

3.) 8 Components of a Social Media Policy

It’s been seven years since we first published this piece by Claudio Pannunzio of Curex Group (but formerly of i-Impact Group). This is the epitome of evergreen content, because even though the social media landscape has changed since 2012, Pannunzio’s advice for developing a policy are still valid and relevant.

4.) Setting Your OOO Message: Best Practices

This post by Joni Youngwirth of Commonwealth Financial Network explores best practices of your out of office message so your clients and colleagues don’t feel abandoned by you when they email you when you’re away. There’s even a handy template in this post for you to use.

5.) How to Handle Clients with Estate Tax Issues: A Financial Planner’s Guide

David D. Little of Hartog, Baer & Hand gives planners handy tips to educate clients on the costs, complexities and risks of various estate planning tools like grantor-retained annuity trusts and qualified personal residence trusts, among others.

Stay tuned to the blog on Thursday for the remaining top most-read posts of 2019.

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Ana Trujillo Limón is senior editor of the Journal of Financial Planning and the FPA Next Generation Planner. She also edits the FPA Practice Management Blog. Email her at alimon@onefpa.org, or connect with her on LinkedIn

 


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5 Steps to Jump-starting the Ownership Conversation

The decision to pursue ownership in a financial advisory firm is a crucial choice in your career. This rewarding goal comes with both benefits and responsibilities that go beyond the role of adviser, and require a variety of business skill sets. Before you consider asking for ownership from the existing owners of your firm, you need to prove that it is not only something you are capable of, but something you have earned.

Here are five essential steps to consider as you build the strongest case for ownership:

Step One: Get Involved

First things first, you must establish your commitment and dedication. Take interest in the ins and outs of running a business (as far as is appropriate) and offer to take on responsibility in these areas. Seize every opportunity to enhance your managerial and business operational knowledge and skills. Not only will this allow you to build up experience to support ownership, it will also help you be better equipped to take on ownership.

You must be willing to do more than just produce revenue. By assuming operational obligations, you are investing in the future of your career and contributing to the overall efficiency and profitability of the firm. Adapt a leadership mindset and work for the good of the team rather than your sole interest.

As you get involved and learn more about the business, examine the company culture and team. Ownership is a long-term commitment, so be sure this is the team and business you’ll be passionate about working with for years to come.

Step 2: Know Your Audience

It is important to recognize the priorities and goals of the existing owner(s) of the business. It’s helpful to get to know your future fellow owners on a personal level, to be sure, but you must dig deeper. Take time to learn about their journey in building the business. Consider how they envision their own careers, including their plans for eventual retirement.

A big part of this step is recognizing the time, energy and money the founding owners have invested in building the business. You should acknowledge that your goal of ownership is meant to build upon and to work alongside them until they’re ready to fully hand over the reins. Keep in mind that a well-crafted succession plan means business growth for the entire company. If you help to make the company grow, everyone involved—including the founding owners—will reap the rewards of a sustainable business.

As you develop your own ideas for the business, directly address the ownership team’s largest business concerns and demonstrate how you can contribute. Ensuring that your objectives align with other owners’ objectives will help you avoid undermining your proposal of ownership.

Step 3: Demonstrate Your Value

In order to take your place amongst the owners of the business you will need to convince the existing ownership team that you add value. Look back at all you’ve accomplished, invested and taken responsibility for. Look to the future, think about the growth of the business and identify contributions you can make that will prove that you are prepared to make a long-term commitment to the business. From there you can establish your value proposition:

  • Refer to your achievements with examples and measurable contributions to growth
  • Present your goals and ideas for the future
  • Research the business’s position in the industry
  • Identify challenges and improvement opportunities and outline your plans for addressing them
  • Be as specific as possible

Step 4: Build the Strategy

Facilitating the addition of a new owner in a financial services business has many moving parts and requires careful consideration and planning. The more you understand the process yourself, the more effective your conversation will be.  You can do some of the legwork in advance by:

  • Exploring effective strategies for internal succession, especially in the context of this unique, relationship-based and regulated industry
  • Understanding the logistics and mechanics of modifying the ownership structure and consider the best way for the business to move forward
  • Considering the business’s organizational, cash flow and compensation structures
  • Examining financing options and how they could integrate with and alleviate hesitancy during the transition process
  • Knowing where to access tools and support to help develop and execute a smooth transition plan

Be proactive about addressing questions and concerns that might arise and show how your proposal can be accomplished, including how you will pay for your share of ownership and how long the process could take. By having some of these answers at the ready, you will show your commitment to the role and your respect of their time and consideration.

Step 5: Timing and Approach

You’ve built a foundation of demonstrable value. You’ve prepared your plan to contribute to the growth of the business. You’ve thought about how to make it all happen. Now it’s time to actually ask for ownership.

Given the weight and delicacy of the proposal, you should find the right setting. Request a formal meeting (an annual review provides an optimal opportunity). If there’s more than one owner, consider whether you want to broach the subject with all of them at once or with just one owner with whom you have a strong rapport.

You should also be sensitive to timing. Pay attention to what’s happening in the company (and the industry) that could either support or undermine your goal of having a productive conversation. It’s best to avoid times of stress due to market performance, taxes or client issues. Identify any potential immediate needs your ownership could help fill such as the imminent retirement of an existing owner or a planned acquisition. Piggybacking on a big professional win can help your case. There is no perfect moment, but a cognizance of timing and circumstances will certainly help the outcome of your request.

The road to gaining ownership in an existing business starts far ahead of asking for it. You must earn the privilege, responsibility and rewards. And you cannot expect that ownership will be granted without evidence of your value as an adviser and as a leader. Once you’re able to demonstrate your initiative, ingenuity and your commitment to the long-term success of the enterprise, you are ready to take the next step in your career as a business owner.

Editor’s note: This article by FP Transitions originally appeared in the May issue of the FPA Next Generation Planner. Download the NGP app today to read all back issues! Stay tuned for the next piece of helpful content from FP Transitions in the December 2019 issue, in which Kem Taylor explores the three questions all next generation planners should ask in a job interview.  

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FP Transitions is the nation’s leading provider of valuation, M&A, succession planning and enterprise consulting for financial advisers. Its integrated team of consultants includes analysts, legal professionals and industry expert consultants working together to provide end-to-end business growth solutions for advisers. Founded in 1999, FP Transitions launched and continues to operate the largest fully supported marketplace for buying and selling financial practices. FP Transitions is the official sponsor of the FPA Next Generation Planner, committed to providing resources and tools that elevate the profession that transforms lives.