Nearly half of US organizations have not implemented any executive benefits strategies to support leadership transitions, NFP's 2026 US Executive Benefits Trend Report has found, despite 81% of respondents saying they cannot afford to lose key employees, and 99% saying their executive benefits have successfully retained top talent.
The tools work. The plan is missing.
The report drew on responses from 273 executive benefits decision-makers across the US. It found that 71% of organizations do not explicitly design executive benefits around succession planning. The gap is most pronounced in the mid-market, where limited infrastructure means succession planning tends to be reactive rather than structured - activated when a departure is imminent rather than built into a standing benefits architecture.
"Many organizations know exactly what is at stake, but knowing isn't the same as being ready," said Tony Greene, president of NFP's Executive Benefits division in New York. "The planning window is closing faster than many organizations realize, and retaining key employees has to move to a formal continuity strategy."
Half of organizations report that key employees are working longer than planned, often past traditional retirement age. Some stay out of continued engagement; others stay because current savings levels do not support a comfortable exit. The anticipated average retirement age has shifted to between 65 and 67, according to the report.
Extended tenures create a bottleneck rather than a buffer. Senior leaders staying longer delay knowledge transfer, compress the window available for succession preparation, and block advancement for the executives beneath them - the people organizations are counting on to lead after those transitions occur. The so-called silver tsunami of baby boomer retirements is still building toward its peak, expected around 2030, but the pressure on leadership pipelines is already visible in how organizations are managing their current senior cohort.
The timing pressure on succession planning arrives alongside a regulatory change that has already taken effect. Under the SECURE Act 2.0, employees aged 50 and over who earned more than $150,000 in prior-year FICA wages from a plan sponsor - a threshold set by IRS Notice 2025-67, effective for 2026 - must now make catch-up contributions to qualified retirement plans on an after-tax Roth basis rather than pre-tax. The final regulations took effect January 1, 2026.
That change removes a planning lever executives have historically relied on. Pre-tax catch-up contributions allowed higher earners to accelerate retirement savings while managing current-year tax exposure. Under the new Roth requirement, the tax benefit shifts to the distribution rather than the contribution - changing the timing and structure of the tax calculation in ways that affect how executives plan their exits.
Nonqualified deferred compensation plans are increasingly filling that gap. Unlike qualified plans, NQDC arrangements are not subject to the Roth catch-up requirement and allow executives to defer compensation on terms a qualified plan cannot match at that income level. Eighty-two percent of employers in the NFP survey say NQDC plans have a high or moderate impact on plan success - and satisfaction with deferred compensation plans has risen from 69% in 2024 to 76% in 2026, tracking the growing emphasis on participant education and plan personalization.
Only 28% of key employees fully understand their executive benefits, according to the report. Twenty-three percent of employers plan to increase education around NQDC plans in the next 12 to 18 months as a direct response. Others are expanding access to financial planning and advisory support alongside the plans themselves.
That education deficit matters because a plan an executive does not understand cannot function as a retention or succession tool. An executive who does not grasp the tax treatment, distribution mechanics, or forfeiture conditions of a deferred compensation arrangement is not making an informed decision to stay - and is not positioned to plan a transition on the timeline the organization needs.
For advisers working on executive benefits, the NFP data makes the conversation explicit. Most mid-market clients have deferred compensation plans that are performing - satisfaction is up, retention rates are high, and 99% say the tools work. What most of them do not have is a succession framework that connects those tools to a defined transition timeline, a clear handover plan, and a benefits structure designed for the specific financial situation of the executives most likely to leave in the next three to seven years.
The succession planning gap is not primarily a product problem. It is a planning and integration problem - one that sits squarely in the space where an executive benefits adviser operating at strategic depth adds the most value. The organizations that close that gap before the silver tsunami peaks will be better positioned than the ones that begin designing succession benefits the month a key leader announces their departure.
