Study Shows Small Business Owners Are Ignoring Opportunities for Succession Planning

According to CNBC, the baby-boom generation approaching retirement has been a threat for decades. These days, however, it’s easy to see how the many individuals retiring on a daily basis is influencing our economy as a whole. Every month, more than 250,000 Americans reach age 65. Nearly 20% of this group reports that they are presently retired, which is an increase from the 10% of individuals aged 65 who entered retirement in 2010. 

These numbers also have implications for small businesses. It’s expected that around 10 million small-business owners have plans to close or sell their businesses within the next decade. These business sales will be a critical source of retirement funds for the business owners.

Up to 80% of small business owners today plan to sell their businesses in order to fund their retirement. These same business owners see their business sale as the potential to fund all of their retirement needs. Despite this vast interest in selling a business, less than 30% of small business owners have an actual written succession plan. This most recent statistic comes from a national survey of 182 financial advisors.