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Personal and emotional considerations

Transitioning out of business ownership is not just a financial decision. It’s deeply personal, impacting identity, daily routine, purpose and relationships. According to the Exit Planning Institute, within a year 70% of business owners profoundly regret selling their business.1 Anticipating and preparing for these changes can reduce post-exit regret. Ask your client the following questions to assess their personal and emotional readiness. (The full guide provides context for you as their financial professional.)

  • How will you spend your time?
  • What will be your identity post-exit?
  • Who will you be without the business?
  • How will you feel after you’ve stepped away from your business?
  • Will you maintain any involvement in the business post-exit?

Financial considerations

Clients also need to consider whether their current income sources, savings and the value of their business can support their desired lifestyle in retirement. Understanding that financial picture now can help you both plan with greater confidence. These questions include:

  • Are you financially prepared to step away?
  • Is your business ready for sale?
  • What are your retirement income needs?
  • Do you know what your business is worth (PDF) today and what it could be upon exiting?
  • What are your other sources of income and capital in retirement?
  • What do you want to preserve, protect or pass on?
  • Do you currently have a contingency plan?
  • Between now and your retirement, if you were to become incapacitated, who would step in and run your business?
  • How would a long-term care event (PDF) affect the finances of your business?

[1] “2023 National State of Owner Readiness Report,” Exit Planning Institute (2023).