Succession Planning: A Third-Act Essential for Business Owners

For business owners, retirement rarely means simply stepping away. More often, it represents a transition into a new chapter – one shaped by questions of identity, purpose, and what comes next for both the owner and the business.

PNC’s recent Business Owner Wealth Insights survey shows these questions are top of mind for a majority of owners, yet too many feel unprepared to answer them. Without a clear business succession plan, retirement can put personal wealth, employees, and business legacy at risk.

“A business succession plan isn’t optional – it’s essential to a successful retirement,” says Judy Raffa, PNC’s Head of Strategic Advisory Solutions. “A well-designed plan helps business owners prepare for what’s next while protecting the long-term value of what they’ve built.”

Why Succession Planning Gets Delayed

PNC’s research highlights a planning gap: nearly 70% of business owners agree planning for the future is important, but 1 in 3 have not yet formalized their succession or exit plan. The biggest obstacles are common ones, including lack of a clear successor, time constraints, navigating family conflicts, and the complexity of the planning process.

“Business succession planning is critical to long-term continuity and legacy for a business, but there are clearly barriers,” Raffa acknowledges. “Bridging the gap between intent and execution in succession planning can help shape long-term business outcomes, financial flexibility, and retirement readiness.”

Beyond financial considerations, succession decisions often carry personal significance, especially for owners whose roles are closely tied to the businesses they’ve built. Early, integrated planning helps ensure those personal considerations are aligned with financial priorities, setting the foundation for a smoother transition over time.

Why Early, Integrated Planning Matters

Business succession planning is most effective when it begins well before retirement is imminent – particularly when business decisions are aligned with personal wealth, estate, and long-term life goals.

PNC’s research revealed that while 67% of business owners manage business and personal finances separately, 82% of business owners look for ways to integrate personal goals with business planning.

Early, integrated planning allows owners more time to:

Evaluate and refine transition options;
Develop internal leadership;
Coordinate business planning with personal wealth and estate strategies; and
Adjust plans as goals or circumstances change.

“It’s important that business owners align succession considerations with retirement planning and other long-term goals,” notes Raffa. “Taking a holistic view creates greater financial flexibility and helps owners make confident decisions about both their businesses and their futures.”

By establishing roles, timelines, and expectations early, owners can move from reactive decision-making to proactive planning.

Succession Paths to Consider

While there is no one-size-fits-all approach to succession planning, some common paths include:

Family transition: passing ownership or leadership to the next generation
Management or employee transition: selling to internal leaders who know the business
External sale: transitioning ownership to an outside buyer
Phased or partial exit: combining continued involvement with gradual liquidity

Raffa notes: “Each path involves different financial, tax, and emotional considerations. The best solution depends on individual goals, family and professional dynamics, and the structure of your business.”

Looking Ahead

Retirement is not a single event for business owners – it’s an evolution into a third act that unfolds over time. Thoughtful succession planning can help owners move into this next phase with clarity, confidence, and a renewed sense of purpose.

“Often, the first step is a strategic conversation with trusted advisors,” Raffa says. “By starting the conversation early and planning thoughtfully, owners can help protect the value of their businesses, support financial goals, and step into their next chapter with greater confidence and purpose.”

PNC’s inaugural report surveyed 300 middle-market and emerging middle-market business owners with annual revenues between $10M and $125M.

Download the Business Owner Wealth Insights 2026 Report.

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Succession Planning: A Third-Act Essential for Business Owners

Why Succession Planning Gets Delayed

Why Early, Integrated Planning Matters

Succession Paths to Consider

Looking Ahead

Important Legal Disclosures and Information