Financial advisors, it turns out, have something in common with their clients: many of them are not prepared for retirement.
   That was one of the conclusions in a new report by Tiburon Strategic Advisors that focuses on the growing acquisition market for financial advisors.
   Among the findings are that most advisors do not have written succession plans. Only about 45% of the largest fee-only advisors and 29% of the largest independent reps have such plans, according to the report.
   That could present a problem, the report notes, since advisors are aging, with 51% of all independent advisors now over the age of 50 years old.
   Furthermore, 53% of fee-only financial advisors and 50% of independent reps intend to sell their businesses upon retirement-typically a sale to an existing partner or employee.
   "The financial advisor acquisition trend is emerging throughout the world," the report states.
   Valuation will become a significant issues as advisors continue to age. There is currently a large discrepancy between what advisors think their practices are worth, on average, and the amount at which they are actually sold, according to the report.
   The report recommends advisors pay close attention to four value drivers: revenue sources, institutionalization, benchmarking and client demographics.
The report states, for example, that institutionalization creates value by making it easier to transfer a business. Benchmarking, meanwhile, allows buyers and sellers to assess value by determining how a firm compares to other firms.
   In terms of revenues, fee-based businesses receive higher multiples than commission-based businesses, the report says. For sales conducted through Business Transitions, an online sales and acquisitions service, multiples are 2.1 times revenues for fee-only practices, 1.8 for fee-based and 1.1 for commission-based.