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CNBC/Financial Planning Association Survey Finds Small Business Owners are Too Focused on Their Business to Plan for Their Own Financial Futures

Englewood Cliffs, NJ & Boulder, CO, August 19, 2014 – America's small business owners are key drivers of the economy, but, when it comes to planning for their own retirement and financial well-being, they are coming up short. A new CNBC/Financial Planning Association (FPA) Small Business and Financial Planning Survey revealed that 70 percent of small business owners' wealth is invested in their businesses and only 30 percent outside their firms.

According to the financial planners surveyed, 42 percent believe their small business clients' biggest financial challenge is developing a retirement plan and exit strategy. This is distantly followed by managing cash flow (23 percent), business tax issues (14 percent), health insurance (6 percent) and raising working capital (6 percent). The CNBC/FPA survey revealed less than one-third of small business clients worked with their advisor on a business plan. For those that did, only 25 percent met with their advisor to review their plan quarterly.

The CNBC/FPA survey highlighted the fact that most financial advisors servicing small business owners are concerned that clients are neglecting their financial investment strategy to support their business. More than half of the respondents, 54 percent, felt their small business owner clients did not have enough protection against financial risks (ie owner disability or death). Twenty-eight percent felt their clients were well protected. Among those that have retirement plans in place the most popular vehicles among small business clients polled are profit sharing 401(k)s (54 percent), followed by SEP IRAs (19 percent) and SIMPLE IRAs (12 percent).

The survey also showed financial advisors are using an array of insurance products to mitigate potential risks including disability insurance (81 percent), liability insurance (73 percent), key man insurance (70 percent), health insurance (63 percent), property/casualty insurance (56 percent) and business interruption insurance (37 percent). Forty-seven percent of FAs who took the survey noted that only 20 percent of their clients had any succession plan in place to ensure a smooth management transition.

Financial advisors who participated in the CNBC/FPA survey pointed to three key initiatives small business owners and their financial planners should follow in order to secure their financial future. These are diversificiation, prepare for the worst and plan for succession.


The CNBC/FPA Survey was conducted May 12 to June 3, 2014 by the Financial Planning Association. It sampled 178 financial advisors nationwide that service small business clients aged 35 to 70.

About Financial Planning Association:

Since 2000, the Financial Planning Association® (FPA®) has been the principal professional organization for CERTIFIED FINANCIAL PLANNERTM (CFP®) professionals, educators, financial services professionals and students who seek advancement in a growing, dynamic profession. More than 23,000 FPA members adhere to the highest standards of professional competence, ethical conduct and clear, complete disclosure to those they serve. Through a collaborative effort to provide members with One ConnectionTM to tools and resources for professional education, business success, advocacy and community, FPA has become an indispensable force in the advancement of today's CFP® professional. Learn more about FPA at and follow on Twitter at

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