From Boomers to Zoomers: Transitioning clients for retirement.

• Author: Walker, April

According to the Retirement Industry Trust Association (RITA), approximately 10,000 Baby Boomers turn 65 each day. Forty-seven percent of Baby Boomers have already retired. Almost 75% of the CPA workforce had reached retirement age in 2020. The number of Baby Boomers in the profession who are retiring is certainly set to increase in the next few years, with changing staffing models and rapidly changing technology and tax legislation.

Succession planning is difficult. Transitioning work to others is hard. But it can and must be done. This column provides insight into the pitfalls that can occur during the transition but also, more importantly, the opportunities and solutions to help alleviate some of the heartburn.

Retiring partner's to-do list

A retiring partner has much to do before making a final curtain call. At the top of the list is determining the "who" and the "how": Who will now be the client's partner or team? How will this be communicated? How will the transition actually happen? This process involves several steps. The to-do list and selection process for a successor partner/staff may include the following:

Considerations for best fit for successor partner/staff

If possible, transitioning a client's relationship to someone they are familiar with will help facilitate the change. It is even better if this can be done gradually. Consider also the client's compatibility with the next generation and how the client likes to communicate. Matching up similar communication preferences will help ease the transition.

Think about what technical skills are needed. This includes considering specialty areas--a tax-exempt entity and a restaurant client would likely need different staff to handle their unique issues. Does the client need someone with an estate planning background? Does the client need financial statements or have other specialized needs such as business valuations? What is the client's experience with technology? Consider also the personality type of the client as well as that of the potential successor.

Considering client termination

Should some clients be terminated upon the partner's retirement? All partners, not just those who are retiring, have their favorite clients and may assume all their clients should be retained and transitioned. A partner's exit is a good time for the firm to evaluate whether all the retiring partner's clients still meet the firm's ideal client profile. These clients might be better suited and better...