Plain and Simple: Bright Business Insights Spring 2018 | Page 8

IS THERE LIFE AFTER BUSINESS OWNERSHIP? YES!
Three Succession Planning Options For Business Owners
If you’re like most owners, you’ve spent a large portion of your career For many, passing a business down to the next generation of family
nurturing and growing your business. As a result, a significant portion members can be very fulfilling as well as an excellent way to preserve
of your net worth is now tied up in the company. But the day when your legacy. However, in order to successfully gift the business to your
you’ll have to decide what you want to do with your most valuable children, there are a couple factors to consider:
investment is quickly approaching. What will you do when it’s
finally here?
1.
You must be in a financial position where you can afford
to give your business away as opposed to selling it. There
When the topic of succession planning comes up, for one reason or are some strategies available to help you maintain a future
another, most owners will go into “procrastination mode.” While some stream of cash flow even when gifting your business to the
might simply believe succession planning to be of little importance, next generation. For example, you could continue to work in
others truly don’t know what they want to do with their business and the business for a salary, provide consulting services or rent
will find themselves overwhelmed by the options. But no matter how property to the business.
hard it may be to zero in on your goals, or how reluctant you may be
to develop your succession plan, you will be more likely to reach your
personal and business goals if you actually take the time to develop a
plan and to put it into action.
2.
Your children must be capable of taking over and managing
the family business. Additionally, they must be able to wear
the many hats that come with the job. As you already know,
being a business owner is not something that comes naturally.
Option 1: Gifting Your Business To Your Children But, the skills can be taught over a period of time. Consider
Do you have a child or children who work in your family business? If takes to ensure they are ready for the challenge.
so, you may choose to gift it to them as you near retirement age.
allowing your children to shadow your work for as long as it