Plain and Simple: Bright Business Insights Fall 2018 | Page 10

A SERIES OF NECESSARY DECISIONS Exploring Succession Planning Options as Retirement Approaches Transfer The Business: If you want the next generation of you care about your employees and trust them to help uphold the considerations. And even though you will be forced to make some family members to run your business after you retire, gifting your business’s existing values after you’ve retired. a long time that the departure of this particular generation from the difficult decisions, having a sound plan in place will ultimately benefit interest in the business might be your best choice. At this time, workforce, which consists of around 76 million people, would hit hard. everybody involved and will allow the business to remain successful, there are some great tax incentives available for those who choose Start Planning Now But what many didn’t foresee is the rate in which this generation has long after your office is packed up. this route. Just remember that even though your legacy will live To get the most out of the transition process, you must not only work on, this option usually means less cash in your pocket. to understand your options, you must start your journey sooner rather The men and women who make up the baby boomer generation, those business issues, as well as financial, estate and retirement planning born between 1946-1964, are retiring in droves. We’ve known for postponed entrance into the next chapter of their lives. Of course there are many reasons why people decide to postpone their retirement. For some, it’s a financial issue. For others, it’s a lifestyle choice. And then, for another group (including many of the business owners we work with), the barrier between work and retirement takes the form of poor succession planning. We’ve worked with a lot of businesses over the years and one universal truth is that to maintain business success and continuity, business leaders must identify and adopt a succession plan. (And the earlier, the better.) With retirement on your horizon, ask yourself the following questions: • What are your goals? • Who is going to run the business? • How involved will you be with the business during the transition • • keep the company up and running, you have the option of looking What is the true value of your business? options available. Succession Planning Options will operate and who will lead the organization when you’re gone. As a business owner nearing retirement, understand and consider your succession options. You could: than later. Furthermore, seek expert assistance and guidance to make sure your succession plan is not only ideal for your particular situation, but that it is being properly executed. outside the family unit for a successor. For many, this is usually Want to learn more about the succession planning process and what one of the easiest options to complete – but that doesn’t mean it’s options are available to you? Give me a call. going to be simple by any means. This method brings its own set of challenges. Once you have honestly and completely answered these four questions, the next step is to educate yourself on the various succession planning Sell To An Outside Party: If your family doesn’t want to continue the business, or they don’t have the skills needed to process? Succession planning is a series of decisions about how your business The succession planning process will deal with non-technical and • • Enter into an employee Stock Ownership Plan (ESOP): As a succession option, ESOPs continue to grow in popularity. This option will allow you to sell up to 100 percent of your business’s stock to the company’s employees. You may be drawn to this method if you don’t have family members who want to take up the business, you don’t want to sell to an outside company, but by: Mark Fearon, CPA, CGMA Principal 112 Fourth Street NW P.O. Box 1020 New Philadelphia, OH 44663 330.308.6894 [email protected]