A Guide to Business Succession Planning
Designing the next chapter of your life while protecting what you've built
By: Michael Sicuranza CFP®, AEP®, CEO and Sr. Financial Advisor and Cheryl Starr CFP®, Financial Advisor
For decades, you've poured your energy, expertise, and heart into creating a business that supports not just your family, but your employees and community too.
Now you're facing one of the most personal decisions of your life: what comes next?
Business succession isn't just about selling a company or transferring ownership. It's about designing the next chapter of your life. One where you have the freedom to focus on what matters most. Maybe that's traveling with your spouse, spending more time with grandchildren, or finally pursuing interests you've put on hold. Money becomes the tool that creates these experiences, not the end goal itself.
The Question That Changes Everything
You might be wondering if there's a "right" way to handle succession. Here's what we've learned from working with business owners like you: the best plan is often different from your original plan.
We worked with a client who co-owned a family business with his brothers. For years, the plan was for his grandson to eventually take over so they could keep it in the family and preserve the legacy they'd built together.
But when a private equity firm approached them with an offer, everything shifted. The sale exceeded their financial expectations and gave them complete freedom to choose how they spend their time like traveling without worrying about quarterly reports, extended family time without checking operations. The grandson stayed on with an excellent salary but without the burden of ownership. Sometimes what looks like changing course is actually finding the path to your best life.
Every business owner also needs an emergency succession plan. What if a health crisis or unexpected event forced an immediate decision?
We'll cover emergency succession planning in detail in a future article. For now, we will focus on three common paths most business owners consider for their planned succession.
Your Three Paths Forward
You're probably considering three main options right now. Each serves different goals and opens different doors for your future.
1. Transferring to family members
This feels natural if your children or relatives are involved. You preserve the legacy you've built, and the transition can feel more personal and meaningful.
But not every family member wants the pressure and responsibility that comes with ownership. And if you're selling to family at below-market rates, how does that affect your own financial security and retirement plans? Are you getting less money because you're cutting them a deal, and how does that affect the lifestyle you want in retirement? What if one of your children is better suited than another to run the business?
2. Selling to key employees
This rewards the people who helped you build this business. Your company culture stays intact, and you know the people taking over truly understand what you've created.
The challenge here is often financing and readiness. Can your employees handle the transition from working in the business to owning it? Do they have the financial resources to buy you out completely, or will you need to stay involved longer than you'd prefer?
But here's what many business owners don't often consider: a key employee could still leave after you've structured the whole succession around them. There are more variables at play like are you going to contractually obligate them to stay? The person who seems most ready to take over might decide to leave and do something else entirely.
3. External sales
This typically offers the highest financial return and can inject new resources for growth. You get maximum value for what you've built, which creates the most options for your next chapter.
While this may be the best financial option, you may worry about the change in culture and what happens to your team. How do you evaluate buyers? What guarantees do your employees have? How long might you need to stay involved in the transition? And perhaps most importantly, the legacy of your company could change completely under new ownership.
That last point, legacy change, is true for all three options. Whether it's family members taking the business in a different direction, key employees making changes you wouldn't have made, or external buyers transforming everything, you have to make peace with the fact that your business will evolve beyond your direct influence.
The questions we explore with you to find your best path:
- What do you want your Tuesday morning to look like in two years?
- How important is it that your company's values live on?
- Are there specific people you want to see benefit from this business?
- What will give you the most peace of mind about your decision?
Are You Ready for This Freedom?
Here's something we recommend to every business owner considering succession: take a two-to-three-week staycation. Stay home. Don't work, don't travel, just live life.
If you're restless by day six, you might not be ready for a complete break from your business. But readiness isn't just emotional, it's practical too. You're likely asking yourself important questions:
- Will the sale provide enough for me to maintain the lifestyle I want?
- What if the business doesn't sell for what I think it's worth?
- What if I get bored or regret selling?
- How will I find purpose and identity outside of being "the business owner"
We've seen succession work best when you have three things figured out: a clear picture of what your life looks like after the business, confidence in who's taking over, and peace with the idea of stepping back from daily operations.
The business owners who initially resist succession planning often change their minds for one powerful reason: a reminder that time is precious.
A friend's health scare. Your own wake-up call. Watching your grandchildren grow up faster than you expected.
These moments help you realize you have enough. You start wanting experiences with your loved ones more than continued business growth, that trip to Italy you've been postponing, regular dinners with your adult children, time to mentor young entrepreneurs in your community. You begin asking different questions about what would make your life feel complete.
These realizations help you work through the deeper questions:
- What will give you purpose when you're not running the daily operations?
- Are you ready to trust someone else with decisions about something you built?
- How will you define yourself when people stop introducing you as "the owner"?
How We Will Guide You Through This Journey
We start these conversations with you years before you thinking about selling. Early planning creates more options and typically better outcomes.
We look at different scenarios to see what each path means for your daily life, your family, and your legacy. We also dive into the technical details: Are you looking at an asset sale or a stock sale? Are you paying capital gains taxes or ordinary income? What expenses will you have? How does this affect your retirement plan and the income you'll need to generate?
We coordinate tax strategies and cash flow strategies; we work closely with your attorney, accountant, and business broker to make sure everyone is aligned, and nothing falls through the cracks.
Some business owners think succession means walking away completely. Others assume they'll need to stay deeply involved for years. The reality usually sits somewhere in between, and it's different for every situation.
We help you figure out exactly where you want to be on that spectrum, then build a plan that gets you there.
Your Next Chapter Starts Here
If you're a client at Affinity Wealth and this resonates, let's add succession planning to our next meeting agenda. Even if selling feels years away, the earlier we start, the more choices you'll have.
Not a client yet? For business owners who found this article while researching succession planning, we'd love to learn about your specific situation and vision for the future. Our Connect Meeting is designed as a meaningful conversation about your life, goals, and dreams.
Your first step is getting clear about what you want your best life to look like after your business. We're here to help you create a plan that makes that vision a reality.
The goal isn't just a successful business sale, it's designing a life where you can focus on what brings you the most joy and fulfillment.
