As of 2025, there are 5.5 million family-owned businesses in the United States. These businesses are an integral part of our economy, contributing 57% of the U.S. GDP – $8.3 trillion. Family-owned businesses currently employ 63% of the workforce and are responsible for 78% of all new job creation.
Despite all the good family-owned businesses do for the economy, only 40% of these businesses successfully transition into second-generation businesses. From there, only 13% are passed down to a third generation, and just 3% make it to a fourth generation or beyond. Family-owned businesses looking to leave a lasting legacy must learn how to position themselves for generations of success.
At Client 1st Financial, we help to build and protect your legacy, and that’s not just for individuals and families. Considering the legacy of your family-owned business is critical to ensure future success, whether that means succession plans, wealth transfer plans, or setting aside ample funds for possible contingencies down the line.
There are some reasons why a family-owned business may not survive that can’t necessarily be planned for. These include family-oriented conflicts like unresolved family discord, bad management or lack of leadership. Some businesses may fail due to high taxes or unforeseen catastrophes, such as natural disasters. Even though these issues can’t be accounted for in advance, you can navigate them more effectively when you have a solid financial plan in place.
When there are so many uncontrollable factors in the landscape of a family-owned business, you shouldn’t let the certainties be the reason your business doesn’t survive for generations. Taking the time now to work with advisors like those at Client 1st Financial to identify your successors, develop a transitional leadership plan, and prepare for estate and business valuation is the smart choice.
Connect with the Client 1st team today and develop your personalized succession plan to keep the legacy of your business thriving for generations.