A Bulletproof Approach in Four Simple Steps
Building a successful enterprise requires fierce dedication. For many entrepreneurs, the ultimate goal is selling their company at top dollar or transitioning it to future generations.
Yet, a glaring disconnect exists between goals and preparation: while 50 percent of business owners plan to leave their businesses within the next decade, only 34 percent have a formal business succession plan in place.1
Without a clear exit strategy, company longevity and your personal financial wellness are left vulnerable. This is especially sobering when looking at generational survival rates—nearly two-thirds of U.S. businesses don’t survive the second generation, and only 13 percent make it through the third.2
Balancing Reinvestment and Personal Savings
When you are growing a company, trying to balance business reinvestment with personal retirement savings is tough. With limited funds, it is easy to funnel every available dollar back into the enterprise. However, relying completely on the future sale of your business is risky. Industries shift, companies falter, and the small-business market remains intensely competitive.
It might help to ask yourself
Would my family and I enjoy a comfortable retirement without my current income or profits from a business sale?
If the answer is no, it is time to recalibrate. A great way to start is by reading the entire e-guide: 5 Retirement Strategies for Small Business Owners.
Building a Bulletproof Approach
Protecting your future requires looking at the bigger picture—from exit planning to risk management and outside support:
- Define a clear exit strategy: Decide whether you want to sell, pass the business to the next generation, or find an outside successor, and hire a qualified professional to evaluate your company's true current value.
- Separate personal and professional finances: Balance your available assets and salary to ensure both sides of your financial life receive attention.
- Evaluate life insurance coverage: Business owners often carry extra liabilities, such as using personal assets as collateral for business loans. Adequate life insurance helps ensure your family isn't left holding corporate debt if the unexpected happens.
- Embrace outside support: Federal regulations and compliance costs weigh heavily on small businesses. Building a trusted team of professionals—including tax experts, attorneys, and financial advisors—relieves the burden and keeps your strategy aligned.
Let's Discuss Your Strategy
Navigating business succession, asset protection, and retirement planning doesn't have to be a solo journey. Chad Cole and the team at Evergreen Financial Partners are here to help you balance your priorities and secure your financial future.
Reach out today at (208) 904-6146 or email Chad@EvergreenFinancialPartners.net to schedule a conversation.
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- AllBusiness.com, 2022
- FamilyBusinessMagazine.com, August 2022