Business Succession Planning
Many individuals run family businesses, farms, and small companies. It is imperative to have a plan in place in the event the primary operator becomes incapacitated, as well as a plan that addresses what shall happen in the event of death.
To not plan ahead, could mean that the revenue stream becomes non-existence should the primary operator become incapacitated. It could also mean that the assets of your business do not transfer upon your death as you anticipate.
Have a plan in place which includes, but is not limited to the following:
Having a solid business structure in place.
- For example, a Limited Liability Company with a strong Operating Agreement.
- Surround yourself with a solid team: legal counsel, CPA, and a trusted financial advisor.
Plan early/ahead and control your plan. Do not wait for a life changing event such as a death, disability, disaster, disagreement, or divorce.
Establish your goals. Identify your needs and expectations.
- Do you need income now and in the future?
- Do you want the family business to continue and to stay within the family?
Have the conversation.
- Open communication – early, often, consistent.
- Are there any children committed to taking over the business?
Protection of your interests.
- Liquid assets for your needs.
- Capital reserved for retirement.
- Agents who will protect you.
- Transfer of knowledge, skill base, and control.