Someday, son, this will all be yours…just not today – Part II

November 30th, 2007 at 06:42am Tom Muldowney

  Thomas A. Muldowney, MSFS, ChFC, CLU, CFP®, CRC, CMP®, AIF®

To make the transition of the family business smoother, Dad not only needs an exit strategy, he needs to know that he needs an exit strategy.  It should include: when to exit, how to exit, at what price and terms to exit, and finally, what is  he  going to do in retirement.  Lots of planning is needed. 

This is also a time for bringing in capable advisors.  Succession planning will include some legal, accounting, financial, banking, and insurance advice.  The accountants will help answer the question, “What will be sold and at what price?”  The lawyer will coordinate the paperwork for the transfer and coordination with the estate.  The financial advisor will help coordinate the retirement’s cash flows, the banker will help arrange for the financing, and the insurance agent will address what happens if someone dies during this transition.  This is a time where good advisors can be of substantial advantage…they’ll help you avoid mistakes and help connect you to resources that you may not have on your own. 

Dad…this little scene study is intended only to remind you of the importance of planning for your transition into retirement. It will not happen by accident.   By opening the discussion, you’ll provide clarity for you, your spouse, your children, successors, and customers.   

Take the first step…make a phone call to your advisor.  Your advisor can help you assemble the transition team and develop a transition strategy, well in advance.  If you do this, everyone in your family will have more confidence and more peace of mind…of knowing how this delicate transition will take place. 

Entry Filed under: Business Succession, Retirement Planning, Financial Planning