Business ownership in 2025: Inside the data

Ann: Welcome back to Building More Than Business. I'm Ann Lucchesi, a certified financial planner and a senior director here at First Citizens Wealth. I am joined by my cohost, Nerre Shuriah, Senior Director of Wealth Planning and Knowledge, and a certified business exit consultant who heads up our wealth planning capabilities.

Today, we're continuing our two-part series on the Beyond Wealth report. And this year we surveyed 1,100 wealthy Americans—which included 500 business owners—to find out how they're growing, managing and protecting their money.

Nerre: In part one, we explored how high-earning Americans are feeling about their personal finances. If you missed episode six, I'd encourage you to go back and give it a listen. Today, we're turning the spotlight to business owners and how they're navigating uncertainty and preparing for the future.

Ann: I'm really looking forward to this discussion, Nerre. So with that, let's dive in. In part one of this series, you mentioned that roughly half of wealthy Americans say they are somewhat or very stressed about their finances. This seems really in line with a lot of what we're hearing from people out there and what we're reading in the marketplace.

Nerre: Agreed. And this year's findings show that business owners are feeling even more stress than nonowners. Six in 10 business owners feel stress, as opposed to five in 10 nonowners.

And we're hearing the same thing from our clients. They're citing a couple of things. A lot of the discomfort really revolves around the sheer number of headwinds coming their way. Inflation, tariffs or the job market—it makes it hard to stay on top of all the changes. This is especially hard to deal with when, in some instances, like with tariffs, it's really unclear what the long-term impact will be.

Ann: Building on that, Nerre, in the last episode you shared a list of the top stressors among wealthy Americans—starting with inflation, where 62% of the people said they cited that as their number one concern, stock market volatility and then shifts in government economic policies, such as the tariffs you mentioned. That really resonates with me because business owners often have much of their wealth tied up in their business. And as a result, they're going to be more stressed about things that can impact the health of their business—things like interest rates and tariffs—as opposed to that stock market volatility.

Nerre: Absolutely. But I think it's important to point out that, despite this increased financial pressure, overall confidence remains high among business owners. Fifty four percent told us they feel very confident in their financial situation, and that's compared to just 35% of nonowners.

Ann: Wow. A 19-point confidence gap between owners and nonowners. That seems really significant to me. Do we know what is fueling that differential?

Nerre: Sixty two percent told us that they own a business to have greater control over their life and financial future. And that sense of control could really play in boosting their confidence levels. For example, many business owners said they're taking proactive steps to strengthen their personal finances in response to economic uncertainty.

And while they're taking some of the same steps as nonowners—like boosting retirement contributions and investments, cutting discretionary funding—they're doing so at a much higher pace. And many also said they're making changes with their business too. They're raising prices in response to economic conditions, ramping up their marketing efforts or renegotiating vendor relationships. Less than 10% of business owners we surveyed plan on reducing employee head count.

Ann: That's really interesting, Nerre, because it seems like we've seen so many headlines about these big companies laying off people. But it just seems like there's a real difference between the businesses that we surveyed, where they're really feeling confident that they can move forward without doing that.

Nerre: Exactly.

Ann: Overall, it sounds like business owners have a greater sense of control, which could be fueling their confidence.

Nerre: And I think this is an important takeaway for anyone who may be feeling increased stress right now. Taking proactive steps will often help give you a sense of control and confidence during periods of uncertainty.

In our last episode, we shared several actions individuals can take to strengthen their financial foundation. The first is, bolster your safety net. Whether that's cash reserves or insurance, make sure that you're covered for any possible negative event.

The second is review your business cash flow. This is important. A common cause of negative cash flow is poor timing, particularly between accruing costs for your business and requesting payments. And an easy fix is to invoice earlier and shorten the payment period.

And lastly, make sure your portfolio is aligned with your long-term goals and risk tolerance—and that goes for business owners and nonowners.

Ann: Let's shift gears for a moment. This year we asked respondents whether they've owned another business before, and that revealed some interesting insights.

Nerre: And let me set the stage. Forty percent of respondents say they've previously owned one business, and a quarter have owned two or more, and I think that surprised us. We didn't realize there were so many serial business owners.

And as you mentioned, when we compare the responses from first-time owners and seasoned business owners, there are some real compelling differences. The first example is how they're responding to economic uncertainty. While experienced owners are taking many of the same steps as first-time owners, they're also continuing to invest in growth. In fact, they're twice as likely as first-time owners to say they've expanded operations or added staff in response to economic uncertainty.

Ann: That previous experience often gives business owners a long-term perspective of how their growth in investments is going to pay off. I also think it makes them more comfortable with taking calculated, appropriate risks to keep their business moving forward—not reckless risks, but the kind that supports sustainable growth.

Nerre: That's spot on, Ann. And what's interesting is that we see that prior experience influences other aspects of business ownership. For example, seasoned owners are twice as likely as first-time owners to secure private equity or venture capital funding.

They're also more likely to say that business ownership has influenced their retirement planning decisions, and their actions reflect that. They're increasing their retirement savings contributions at a higher rate than first-time owners. They're also spending more time on retirement planning, and they're more likely to work with a professional to make sure they're on track.

Ann: You mentioned that seasoned owners are twice as likely as first-time owners to secure outside funding, and that really resonates with me because I've talked to founders who've had successful outcomes, are on their next venture and I've asked them how much of their own money they're going to invest in this new business, and they're like, "Why should I play with my money when I can play with somebody else's?"

Speaking of planning, in our last episode you and Mark talked about the growing retirement gap. This year, respondents said they'll need about $6.3 million to retire and to pass on wealth, but the amount they've saved has stayed flat at about $1.6 million. So what they need to retire is more than three times what they've saved. That's a pretty significant gap.

Likewise, the expected retirement age of full retirement has risen from 64 to 65. Are we seeing similar trends among business owners?

Nerre: Business owners have a little more saved for retirement than nonowners. They're at $1.8 million versus the $1.6 million that you mentioned. However, they're less confident in their ability to retire on time. The average business owner doesn't fully expect to retire until age 66. That's 1 year later than nonowners, who were themselves 1 year later than they said last year.

Likewise, the majority of owners say they don't plan to exit their business for at least 7 years, and nearly half don't plan on exiting for at least a decade. That's much different than what we thought would happen during this time frame.

Ann: Retirement planning clearly remains a key issue across the board, but I think there's another layer to this. Many business owners struggle to step away because their identity is so closely tied to their business. For a lot of owners, it isn't just about the money. They genuinely love what they do. That passion may be one reason why we're seeing such long exit timelines, Nerre.

Nerre: The majority of owners we surveyed—94%—say that running a business is worth it. Their top reason isn't even financial. Nearly eight in 10 point to personal fulfillment.

Ann: Yeah, this aligns with what we're hearing on a day-to-day basis. It struck me that 47% of the respondents either did not have an exit strategy or were unsure of their exit strategy. Many owners plan to stay in the game longer, but life, market conditions or family dynamics often change the timeline.

I'm reminded of a young man that I worked with who had been building a business, and all of a sudden he got an offer far in advance of when he thought he'd be selling his business, and the offer was just too good to turn down. The problem was he hadn't prepared. So his stock didn't meet the QSBS qualifications—that's the qualified small business stock exemption that we've talked about previously. He immediately was in a taxable estate, and he hadn't done any planning around that, and he could no longer gift away anything at lower valuation since he had an offer in hand that he wanted to accept.

Had we started planning earlier, we could have helped position him better financially, tax-wise, emotionally—and the transition might've come sooner than he expected, but he would've been somewhat prepared.

Nerre: That's something we see more often than we'd like, isn't it? However, experienced owners are more likely than first-time owners to say they have an exit plan in place. Again, those who've traveled the path before as an owner are more likely than nonowners to act on the learning they've gathered from previous experience.

Ann: Yeah, there's nothing like experiencing a little bit of pain the first time around to make you appreciate why planning matters on the next round. It really does reinforce how important it is to prepare in advance so when the exit finally comes, the process feels smoother and is far less stressful.

Nerre: Exactly. And we've talked about how plans don't always align with reality. Over half of owners plan on selling their business to a current stakeholder, with family members being the most common recipient. People often assume that transferring a business to a loved one will be seamless, but that's not always how it plays out.

Ann: And even when the next generation does want the business, not having formal documented requirements around things like succession, compensation or conflict resolution can really create major challenges for them.

Nerre: That's so true. We worked with a third-generation, family-owned manufacturing company, and they had no documented plans in place. Everything was handled informally, not just the exit plan but the way they did business was a handshake or a verbal agreement.

One family member disagreed with how dividends were being distributed to his siblings, and it caused such a rift that they stopped speaking to each other. Fortunately, we stepped in as a neutral third party, had some family meetings and helped them bring financial and legal structure to both the business and conflict resolution. Over that time, their emotions tempered and then allowed the family to map out a clear transition to the next generation.

Ann: What a great example, Nerre. It reminds me of the discussion we had in episode two about transition planning.

Nerre: And as we discussed in that episode, good planning happens in stages. Working with a trusted advisor helps break down the process into manageable phases—before, during and after the transition.

Ann: This has been a great conversation. I think we have some great takeaways from all of this information. Business owners are planners by nature, and they're able to adapt and balance today's realities with tomorrow's goals. All of this is what keeps them moving forward.

Nerre: This year's Beyond Wealth report really shows how deeply intertwined business and personal finances are for owners. They're facing challenges on multiple fronts, from inflation and interest rates to delayed exits and changing retirement timelines. But really what stands out is their resilience. They're planning ahead and continuing to find great fulfillment in the work that they do.

Ann: While we've separated the personal and business findings across these two episodes, I think they're really two sides of the same coin, Nerre.

Nerre: And I want to remind our listeners to check out part one of this series in episode six if you haven't already. In that episode, we break down how wealthy Americans are growing, managing and protecting their money this year, and it provides good context for today's conversation.

And if you'd like to dig even deeper into the results, be sure to visit our show notes. We've included a link to the full 2025 Beyond Wealth reports—both parts.

Ann: Thanks so much for listening to Building More Than Business. If you enjoyed today's episode, follow us on Apple Podcasts, Spotify or YouTube Music, and share it with another business owner who might benefit from these insights. We'll see you next time.

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