The NextChapter Newsletter
WINTER 2025
Turnover at the Top
Five questions for new CEOs and their teams in the wake of historic departures
2,221 US industry CEOs left their roles in 2024 – up from the prior record of 1,914 set in 2023 – representing a new high in the 23-year history of the annual survey from consultancy Challenger, Gray & Christmas. The financial sector accounted for 112 departures in 2024 with recent departures at industry leaders from Morgan Stanley, Vanguard, LPL and 46 insurance companies.?
The report cites reasons for the departures. More than half are listed as “resignation”, “stepped down” or “no reason given”, while straight up “retirement” accounted for just 1 in 5 CEOs. Anecdotally, our NextChapter team observes company boards seeing a different, more complex operating environment ahead – and acting in anticipation of needing different insights, perspective and skill sets. External hires again outnumbered internal replacements.
TOUGH ACT TO FOLLOW
In financial services, new CEOs arrive at a time of record profits powered by historic market returns – a tough act to follow when most clients are aging and? the next generation skews DIY. Add the looming impacts of AI, retiring advisors and hiring hurdles and the fun is just starting for new leadership teams. Read more about the ramifications to firm valuations here.?
LEADERS: FIVE QUESTIONS FRAME YOUR FUTURE RESULTS
1.??????? How will we measure our results?
-????????????? “Organic growth is the life blood of a business”, says the wealth management leader of a national firm. Net flows matter so get ahead by knowing both age-weighted and gender-weighted revenues marking how well you engage G2/G3 and women. Manage product mix, client and household share of wallet as well as proactive contact direct with clients via net promoter score.
2.??????? How do we retain our existing clients and their families? And should we?
-????????????? “Retention is an underrated strategy”, says the CEO of a monster platform. Failure to engage G1 spouse/partners is compounded by ignoring G2/G3 family. Only 31% of 30–39-year-olds retain their parents’ advisor and surviving G1s tend to follow their kids. But not all nextgen are worth keeping, so what is the strategy?
3.??????? Where will we find younger advisors?
-????????????? There are more CFPs over 70 than under 30. Surveys list significant barriers to potential new hires including age and gender gaps, “sales” compensation, negative perceptions of the industry and educational disconnects in college courseware. Our NextGen Engagement study reveals G2/G3 advisors paired with G2/G3 clients through family engagement and leveraging The Moments.
4.??????? How will we manage our aging and retiring advisors? What impact will they have?
-????????????? Data indicate 30% of financial advisors are 60+ and manage more than half of advisory firm assets. Advisors seeking their own retirements have little incentive to retain clients and engage nextgen. We see potential in new product mix strategies of protected income for G1 clients and long-term care to engage G2.
5.??????? How do we work with clients that lose their ability to make good decisions?
-????????????? 74% of advice industry assets are held by clients older than 60 and the median age is 77. 1 in 7 Americans 70+ suffers from some form of dementia and 2/3 of those have Alzheimer’s disease. What is your current protocol for determining diminished capacity, recording of Trusted Contact, proactive POAs and tracking of elder fraud? Have you been in litigation or arbitration with a family over responsibility associated with elder fraud or abuse??
NEW HEADWINDS ARE GROWING – BUT SO ARE OPPORTUNITIES
Stock prices are up 650% since the March 2009 low, but the potential for a market slowdown is not the only challenge for new leaders. The bull run has masked increasing outflows around Peak65TM – the greatest number of Americans turning 65 in history happens now in 2025. Savvy advisors are leaning into this transition of wealth using life triggers – The Moments That MatterSM - that drive more than 60% of advisor new hires. Read more here:
NextChapter has answers.
THE BEST ADVISORS TO NEXTGEN ARE SELF-MADE BUT THEY DON’T HAVE TO BE
Our new study of RIA and IBD advisors successfully working with families reveals:
Advisors say their firms can make significant gains with NextGen if they:
The NextChapter team led by managing director, Suzanne Schmitt conducted in-depth 90 minute interviews with advisors from Ameriprise, Cetera, LPL, Osaic, Raymond James and several RIAs including Accredited Investors, Essex Financial, 24Wealth and The Investors Center. We captured many additional best practices, recommendations and insights. Please contact us at [email protected] for more information about the study.
?WELCOME MIKE DANICK TO NEXTCHAPTER
Mike Danick is our new Executive-in-Residence. A nearly 30 year veteran of Fidelity Investments, Mike brings experience in risk, finance, operations and longevity risk management, as well as a deep understanding of both the consumer and advisor markets. He will be working with NextChapter relationships across the IBD and RIA world as we invest more time in helping firms with NextGen engagement.
Read more about Mike on LinkedIn.
And reach out to him at [email protected]
NEW ADVISORPEDIA PODCAST: SUZANNE SCHMITT AND TOM WEST
From Advisorpedia’s Family Financial Conversation Center, NC’s Suzanne Schmitt and our colleague, Tom West of Signature Estate and Investment Advisors take on another planning perspective. Our recent study of advisor best practices shows the value of candor in working with clients. Listen to two of the industry’s best practitioners here:
?On behalf of the NextChapter team,?
Steve Gresham?
203.623.2265
For a full PDF (with better photos!), please email us at [email protected]
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