US bosses don’t want children as successors

June 19, 2023

Wells Fargo survey of 1,000 family business owners reveals search problems

A good one in two American business owners do not want to hand over their company to their children. This is the conclusion of a survey conducted by Versta Research on behalf of the US financial services provider Wells Fargo (https://www.welsfargo.com). Over 1,000 people aged 50 and over with at least one million dollars in investable assets took part.

Many doubts about capabilities
Reasons for this reluctance range from doubts about their children’s ability to run the business successfully to concerns that a substantial inheritance might discourage their children from pursuing their own financial success. 94 per cent of parents express a desire for their children to go their own way rather than follow in their footsteps.
According to the survey, nine out of ten of the respondents attribute their financial success to hard work and determination, while two-thirds emphasised the benefits of a good education. Yet almost half worry about their offspring’s ability to accumulate wealth.

Inquire about interest in principle
A significant number of parents surveyed provide substantial financial support to their adult children. 81 per cent would help their children out of financial difficulties. “More and more parents are realising that their children are simply not interested in joining the family business and are not pressuring them to do so,” says Fargo wealth manager Michael Liersch.
According to the expert, it is important for effective succession planning to know what interests the children and where their strengths lie. The findings underline the importance of having open and thoughtful conversations about wealth planning and business succession to ensure that everyone in the family is on the same page.

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