Why you need to start planning now.
We get it. You’ve put everything into the business and in return, it has rewarded you with pride and wealth enjoyment. You’re not ready to leave the business, not just yet.
But you don’t have to be selling today to think about what’s next for your business. In fact, planning ahead of time is crucial to leaving you with more options. In our experience, building out a strategy that allows for ownership transition over five to eight years can bring the following benefits:
Continuance of lifestyle
For years, the business has been the engine for your ability to save and live the lifestyle you want. However, the amount you need to retire comfortably could be more than the value of your company. That’s why you need to use time wisely. Start strategizing now to increase the value of your business, so you can extract the right amount when retirement comes.
Continuance of leadership
Truth is, the person you had in mind to take the business forward, say a family member, may not want to do so. Having open discussions about this today allows you to pivot to an alternative strategy like selling to a key employee.
Continuance of success
Succession strategies allow you to reflect on how the business environment has evolved and what its current and future needs are, so you can identify the best successor. While each new leader brings new skills, interests, and aspirations to the table, you can set them up for success by giving them the time they need to adjust to their new role.
For more on how you can plan for retirement or use insurance products such as life insurance to fund a buy-sell agreement as part of a business succession strategy, talk to your financial professional.
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