Leaders spend so much time working in their businesses and achieving their professional goals it can be easy to forget to plan for what happens later in life. Ultimately, it requires thinking beyond the successful companies to invest in your future. 

At a recent BMO event in Wisconsin, I hosted a fireside chat with Rebecca Hulce, CFP, Vice President and Senior Wealth Planning Strategist, BMO Wealth Management. We discussed strategies for wealth planning, business succession and how to handle the emotional transition that comes with retirement.  

We’re in the early stages of what’s being called “the great wealth transfer.” Cerulli Associates projects that $124 trillion in wealth will transfer in the U.S. by 2048, about $105 trillion of which will go to heirs. Hulce said that’s why it’s essential to have a financial roadmap that looks beyond your career.  

Some of the key documents your plan should have include a basic will, a revocable living trust, financial power of attorney and healthcare power of attorney. Depending on where you live, your estate plan may also need to include a marital property agreement to define what assets belong to each party in a marriage, and whether those assets are considered joint assets or individual property. 

“A will is an important document, but it doesn’t do anything for you until you pass away,” Hulce said. “That’s why some people should have a trust. That helps in situations where you might not be functioning at full capacity, but you still want to declare who would step into your place.” 

But too many business owners and executives don’t have a plan in place at all. “You’d be amazed at how many people we talk to who have done zero planning,” Hulce said. “We fall into a trap of thinking things have to be perfect, and therefore do nothing. But starting to do something is better than nothing.” 

Hulce added that among those who have a plan, many of them don’t update it to account for significant life changes, such as divorce, losing a spouse or children growing into young adults. While these types of life milestones are good occasions for updating your plan, Hulce said a best practice is to review it at least every five years.  

Business succession is also a critical component of building wealth, but too many business owners are unprepared for this as well. A 2024 BMO for Women report found that half of male business owners had a detailed transition plan in place, while only one-third of women had one.  

One of the main reasons cited for the lack of a transition plan was that they were not planning to retire. But as Hulce said, the idea of working until you die doesn’t always pan out—health concerns, family dynamics and other issues can disrupt that plan. So, what should business owners pay attention to as they look to transition their business? 

“You want to maximize the value of your business,” Hulce said. “A lot of business owners just plow everything back into the business, and that misses the next step of setting up a transition.” 

That includes thinking about what the continuity of your business looks like. About 30% of family-owned businesses survive into the second generation, and only 12% make it to the third generation¹, so establishing a succession plan early is key.¹ If the end goal is to sell the business, you’ll need to understand the steps involved before the process begins.  

Ideally, you should start thinking about your transition plans as soon as you create or acquire the business. At a minimum, Hulce said, you should get the process rolling five years before the transition.  

“You should be thinking of that transition the moment you’re coming in,” she said. “This is a multi-tasking kind of thing. You have to think through the personal side while running the business at the same time. You want to start engaging the right people even if you don’t have a set timetable yet.” 

Along with the financial aspect, preparing for life after business involves a fair amount of emotional planning. It starts with knowing when you’re ready to exit. Hulce said for many business owners, it’s when they notice the passion for the work isn’t what it used to be. 

“If that burning desire starts to wane, that’s a big sign,” Hulce said. “Every business owner has done the blood, sweat and tears to get the business going. If that isn’t your passion anymore, it’s time to start thinking that through.” 

The transition from living off a regular salary to all of your income coming from investment disbursement also requires an adjustment. “I have a client that for the first three or four years of his retirement, we had to make distributions to him every two weeks because that’s when he was used to getting his paycheck,” Hulce said. “Otherwise, he was convinced this money wasn’t real.”  

Recent stock market volatility has taken a chunk out of many people’s retirement investments, and it hits particularly hard for those nearing retirement age. That’s why Hulce recommends keeping some cash holdings.  

“We talk about having bank deposits, having money that you can see in that account is that first bucket that you feel comfortable with,” she said. “Some people need a big number to get to that first level of comfort so that they don’t panic [during a market downturn].” 

Ultimately, educating yourself is the most powerful tool. “I hate to go to meetings where you’re expecting a husband and wife, and only the man is there,” Hulce said. “In the end, the woman might survive her husband, and if she doesn’t have any relationship with the advisers, not only is she dealing with the emotional loss of a loved one, she’s also feeling [financially] lost. That’s why it’s important to get to know the people you’re working with and looking to for advice.” 

^{1 Family Business Association - Letting Go of the Reins}