Planners no longer delaying retirement plans

Financial planners who delayed their retirement plans as the global financial crisis (GFC) hit are now starting to come back to market.

According to specialist financial planning practice brokerages Kenyon Prendeville, Radar Results and Centurion Market Makers, while concerns about the regulatory changes led to an increase in enquiries from those considering selling, it had not resulted in significant action. However, there is an uptick in those coming to market as they near retirement.

A list of recent sale transactions from Kenyon Prendeville revealed that the majority were retiring. One such adviser is Peter Fitzpatrick of Axis Financial Management, whose retirement plans were delayed by the GFC.

“I didn’t take the business to market because it would have looked like a rat leaving a sinking ship,” Fitzpatrick said — a sentiment shared by other advisers who spoke to Money Management.

Fitzpatrick said the delay had more to do with being responsible for his clients than falling revenues. He said the regulatory reforms did not motivate him to leave as he was positive about the direction being taken and felt new blood would thrive in the new environment.

Another planner with a positive outlook is Sandy Hazzard, a Professional Investment Services authorised representative who always had the goal of retiring at 60. He said the regulatory changes were not instrumental in him deciding to sell, although he felt some of the changes were “over the top”. Hazzard is gradually selling off his client book over time and felt that a slower transition process was very important because “there’s no such thing as owning a client base”.

“The clients own themselves, and I think it’s very important that the transition is handled very carefully,” he added.

Radar Results has hosted a number of workshops for people who want information on selling a practice, and principal John Birt said the number of enquiries had picked up. However, he said this had not necessarily translated into sales. Chris Wrightson of Centurion Market Makers said he had a similar experience.

In general, Wrightson said, most planners making enquiries were nearing retirement anyway and more than likely some had decided to bring their retirement plans forward because they were not up for another round of regulatory change — a comment supported by Fitzpatrick.

“They’ve got to the point where they’ve had a gutful,” Fitzpatrick said.

The chief executives of the Association of Financial Advisers and the Financial Planning Association, Richard Klipin and Mark Rantall respectively, agreed that those looking to leave because of regulatory change might be doing so prematurely.

However, some advisers have had enough and one such adviser, who is in the process of making a deal and therefore did not want to be named, felt that regulators had made it too difficult for advisers while failing to root out “unscrupulous advisers who don’t know what they are doing”.