Von Aldo

What Is Your Advisory Practice Worth?

In truth, you probably don't know. As we have written many times, custodians are all about trying to help you figure that out, to help you create a succession plan. Yesterday, TD Ameritrade Institutional says it found that a majority of independent RIAs don't have a formal succession plan --- and stand ready to help you figure out what your practice is worth.

It's all about helping advisors, of course, and seeking an edge in gathering assets. The other custodians, Schwab Institutional, Pershing and others, all offer help in valuing your business. With the average age of FAs hovering around 55, it's probably time to get started.

I'd be interested to hear from readers what kind of valuations they are getting these days for their practices. Please give me a call, all confidential of course. 212-204-4215. Am trying to get a handle of what the succession deals are looking like --- how long are the earn outs? How much in cash up front? What is the multiple base on?

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