Posted By 
By Jeff Johnstone, National Bank Financial Wealth Management
Special to Financial Independence Hub
In my world, financial planning is a lot like building a home. You can spend decades refining the interior — growing revenue, managing cash flow, building something you are proud of — but without a strong foundation, the entire structure remains vulnerable. For the roughly 500,000 small business owners across Ontario, that foundation isn’t only the balance sheet; it’s a clear, well-structured succession plan.
We’re standing on the edge of what many call a “silver tsunami.” By 2030, more than one in five Ontarians will be 65 or older. It represents one of the largest transfers of leadership and wealth in history. Today, nearly 75% of business owners are planning to exit within the next decade. For founders, that creates a new reality because it’s no longer about finding just a buyer, it’s about being a business worth finding and buying. Yet while many expect to exit, few have a clear plan for what happens next.
When entrepreneurs sit down with us, three themes tend to surface:
- Concentration risk — the majority of their net worth is tied to a single asset: the business
- Tax complexity — not whether tax will be paid, but how much can be preserved
- Uncertainty — stepping away is not just financial, but deeply personal
These challenges are all interconnected. For incorporated business owners, personal and corporate wealth need to be aligned: linking how value is created inside the business with how wealth is ultimately realized outside of it. The goal isn’t to extract value at the end, but to translate it gradually into long-term financial independence. Without that bridge, the business risks becoming not a means to an end, but the end itself.
Founders often underestimate Timing
One of the biggest misconceptions we see is timing. Many founders believe they can decide to sell and complete the process within six months. When in reality, a successful, high-value transition rarely follows a short-term timeline. The average timeline is closer to five years from initial planning to final sale. Understanding this matters because, if you wait until you’re ready to exit — or until you’re burned out — and believe it can be all closed quickly, you’ve already lost leverage and, in many cases, left value on the table. Buyers don’t just assess financial performance; they assess risk. A business heavily dependent on its founder carries a very different profile than one that can operate independently.
The earlier you start, the more control you have. That’s the takeaway here. Early planning changes what buyers see. It creates time to strengthen management, reduce key-person risk, and professionalize operations. It also allows for what I often describe as a “financial clean-up”—organizing financials, addressing shareholder loans, and ensuring the business can run without you at the center. Because ultimately, it’s about being profitable, as well as it’s being sellable.
One of the most complex parts of succession is rarely financial, and happens outside the boardroom and round the dinner table. We call this “dinner table math,” when assumptions are made but haven’t (or rarely) been discussed. For example, parents may assume the children will take over the business, but they do not want to. Yet, the children may feel obligated to, even if their interests lie elsewhere. Beneath it all are unspoken expectations about what feels fair.
Where many transitions begin to unravel
This is where many transitions begin to unravel. Nearly 70% fail because of breakdowns in communication and trust, versus market conditions. For example, in one case we had one family assume the business would pass to the next generation. Through structured conversations, it became clear that while the children respected what had been built, none of the kids wanted to run it. That honesty was difficult, but the clarity was necessary. It opened the door to a different path that was focused on a structured sale to an external buyer, alongside a plan to distribute proceeds in a way that felt fair and transparent. Just as importantly, it preserved the family relationships.
These are not decisions founders should navigate alone. With the right advisory team — wealth advisors, accountants and legal professionals — we can help create space for better conversations and more thoughtful decisions. In our experience, the best work happens alongside a dedicated M&A and investment banking team who can help deliver a more coordinated approach. Preparation becomes more intentional, buyer selection more strategic and outcomes — across valuation, structure, and legacy — more aligned with what matters most.
However, the real difference is seen and felt in how early and how deliberately the process begins. This is where the idea of “planning with a warm hand” becomes important. It means making decisions while you are still present, engaged and able to shape the outcome and to see the transition unfold on your terms. The alternative — planning with a “cold hand” — leaves those decisions to others. Executors and family members are left to interpret intent in already difficult moments, often leading to unintended outcomes.
The view on the purpose of succession planning needs to flip from simply being an exit strategy, to a long-term plan that touches capital, relationships, identity and legacy. By the time you are ready to exit, the most important work should already be done. For some, the transition will be smooth. For others, rushed or uncertain. What determines the difference is the groundwork that has been laid early, because the strongest transitions are built intentionally, over time. Not just at the point of sale.
If you want to maximize both your options and the value of what you’ve built, the most important step is starting the conversation earlier than you think you need to.
Jeff Johnstone is a Senior Wealth Advisor at National Bank Financial. With over 15 years of experience in the wealth management industry, Jeff started his career at a global independent wealth management firm before moving to National Bank in 2016. Jeff specializes in providing tailored investment and financial planning advice to high-net-worth families, business owners and professionals.
Jeff graduated from Queen’s University with a B.A in Economics. Jeff also serves on the board of the Ontario Sports Hall of Fame and volunteers for the Step-Up Challenge for Prostate Cancer Canada. In his spare time, he enjoys spending time with his wife and daughter. When Jeff isn’t chasing his daughter around, he enjoys playing hockey and golf and cheering on the Toronto Maple Leafs.
