Many financial advisors isolate their personal goals from their business goals when developing a succession strategy. They tend to not ask themselves what’s going to be most important once they retire. This failure leads to making short-term succession decisions instead of providing a long-term solution.

When you’re thinking about business succession planning, it’s also time to ask yourself some personal questions. If you ask most entrepreneurs what they care about, aside from their business, they will most likely mention their families, their current and future financial situations, their philanthropic commitments and their health. They may also express concern about the future fate of their business, its employees and clients.

Few, however, will spend the time to factor what impact the succession plan will have on these important parts of their lives. As an example, think about the decision to sell your financial advising business versus keeping control of the company within your family. Have you evaluated this decision relative to the things that are important to you personally? How will this decision impact your family relationships moving forward? Will you be able to walk away and let your children take over the business? Are you confident they can grow the business, so they can “buy” it from you? How will the family dynamics change? The answers to these questions are critical to your future and your retirement.


The 2017 Family Business Survey conducted by PWC provides helpful insight into how other successful entrepreneurs are dealing with this critical question – keep the business in the family or sell to an outsider. This survey shows a gradual shift away from retaining the business, especially if no family members are currently involved in managing it.

Pass on to family to own and run52%44%41%
Pass on to family to own but not run14%26%11%
Sell to outside party12%19%30%


The decision to sell to an external business owner is a shorter time-horizon to retirement. Instead of gradually evolving the sale to family members or former partners, you’ll be spending a short six-months (or so) on a new owner “break-in” period. The decision-making process for the sale is financially-driven and direct. The rewards are quickly available and assured.

The approach for transitioning your business internally, from one manager/owner/leader internally to another, extends the process for years, making it a long-tailed and less predictable payout. This is another consideration to factor into your business succession planning.

The complex dynamics of finding and naming your successor CEO is another important concern. You represent three different “people” to your company, raising the following questions:

  • who’s going to run the business once you retire?
  • what plans are in place to transfer ownership?
  • who’s going to carry on as the business leader?

Recognizing the importance of these business roles may lead you to the realization that finding a new CEO will be no easy feat – even if you decide to look within the family.


If you keep your business family-owned, do you have confidence the new leadership can run the business successfully without you? Based on the special criteria you’ve defined for the leadership role, you’ll want to focus on what the company needs, what business and industry knowledge you feel is necessary for the position and what business acumen is critical. Do you have an ownership succession plan in place for your financial advising practice? What’s the family’s perspective? Do you have key employees locked in with incentive plans? What are the tax implications for various ownership transfer strategies? What have you established from a timing standpoint?

Finally, and most importantly, have you identified and groomed the new business leader? It’s critical to make a distinction between a leader and a manager. Is your choice controversial within the company or the family? Are other family members/employees in sub-leadership roles?

The findings from a study completed by E&Y and Kennesaw State University last year show that, 45% of the time, business succession planning was done by the business owner alone or by the business owner and the family. As you address some of these important questions, you may want to involve your family in a discussion of your various options and the implications for all the parties involved. Bring your personal goals and expectations and those of other family members together. These conversations will most likely produce a succession plan that will improve your business succession decisions and pleasure of retirement.