Episode summary
Ep 507: Growing Bigger For Succession And Then Intentionally Downsizing For A Simpler Lifestyle P...
Financial Advisor Success (Kitces)
· · 1 hr 25 min · Hosts: Michael Kitces · Guests: Carolyn McClanahan
Summary
Carolyn McClanahan describes a firm that deliberately grew, then deliberately shrank, because the larger team stopped serving her life goals. Life Planning Partners now has about $1.6 million of revenue, 65 client households, about $300 million in assets, and a leaner team after downsizing from roughly 100 clients and a much more ambitious staffing plan.
The key turning point was succession planning. McClanahan says she initially assumed a younger planner would become her successor, but she did a poor job communicating expectations, development standards, and what ownership would look like. After that relationship broke down, she hired business coaches to define job descriptions, compensation, and measurables, then tried to build a deeper bench of advisors. But with multiple younger hires still learning a highly customized, multidisciplinary planning process, she found herself working 60 to 70 hours a week and doing too much reviewing, teaching, and problem-solving herself.
She ultimately chose to downsize rather than keep expanding. McClanahan kept her oldest and most complex clients, preserved relationships with local households, and helped roughly 35 clients find new homes with other advisors. She says the decision was driven by values, family realities, and a desire to work three days a week while staying in the profession another six to eight years. She also argues the industry needs real residency-style training because one capstone plan is not enough to create a true financial planner.
Key takeaways
- Carolyn McClanahan says the firm is now designed around a simpler lifestyle, not maximum growth, with 65 households and about $300 million under management.
- McClanahan says her first succession plan failed because expectations were not clearly communicated and the younger planner was not yet developed enough for the role.
- She hired business coaches to tighten compensation, job descriptions, and advancement measurables, but still found too many early-career advisors learning at once.
- McClanahan says the biggest burden was not routine planning work, but being the lead problem-solver on complex client issues while training the team.
- She argues the profession needs residency-style training because real financial planning requires supervised experience in tax, estate, insurance, communication, and problem-solving.
Notable quotes
“the biggest challenge I think in our firm is we truly are comprehensive people talk about being comprehensive”
“I did a very poor job of explaining to my succession plan back then that I basically was going to give him the practice at maybe onetime revenue”
“I was working 60 70 hours a week sometimes and you know averaging over 55 hours a week for the whole year”
How the episode opens
Welcome to the Financial Advisor Success Podcast, where you go behind the scenes with financial planner, speaker, and consultant Michael Kitsus to hear stories of how leading financial adviserss navigated the inevitable challenges that arise on the path to success and get insight from leading industry consultants about how to break through to the next level in your advisory business. And now, here's your host, Michael Kitsus.
Welcome everyone. Welcome to the 57th episode of the Financial Advisor Success Podcast. My guest on today's podcast is Carolyn Mlanahan.
Carolyn is the founder of Life Planning Partners, an RAIA based in Jacksonville, Florida, that oversees $300 million in assets under management for 65 client households. What's unique about Carolyn though is how she grew her firm to more than 100 clients before deciding to downsize to improve her work life balance as she also executes a succession plan. In this episode, we talk in depth about how Carolyn initially planned to grow her advisor team to handle increased client demand with her firm closing and reopening to new clients over time.
How Carolyn invested significant effort in training new employees on her hightouch planning process, hoping that doing so would pay off by developing potential successors. and how Carolyn ultimately had to face the prospect of departures of younger employees who wanted to pursue different paths, forcing her to start over with new hires. We also talk about how Carolyn worked with business coaches to ensure that she offered competitive compensation and development plans for employees and to help her and her staff align their life goals with their professional paths.
How Carolyn ultimately made the decision to downsize her client base to have more free time for herself and pursue her goals supporting the planning industry. and how Caroline has created a new succession plan that allows her to continue serving clients while transferring ownership to employees at her firm.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- downsizing strategy
- firm growth and succession
- work-life balance
- burnout
- compensation structures
Companies and tickers mentioned
- Life Planning Partners
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Financial Advisor Success (Kitces), this episode and its artwork belong to Michael Kitces. Octagon is not affiliated with the show; this page is an independent summary.
