by Anita Sherman, CPA | Managing Partner
In the last couple of weeks, I have been focusing on several of the important elements that are essential in order to successfully transfer your business to the next generation of leaders. In our March 22, 2012 enewsletter, I discussed the importance of having a process to assist in developing all the skills that will be needed by the Next Generation Leader in order to not only carry on, but to take the business to the next level. I also identified four reasons why it is in your best interest to make the additional effort to ensure success.
In our April 6, 2012 enewsletter, I reviewed the startling statistics that only one-third of businesses are successfully transitioned to the next generation, and when it comes to transitioning the business to the third generation, the success rate drops to 13%.
Regardless of which generation you represent, another issue that often creates an unwillingness or concern to begin a transition process, is the fear of not having enough money to retire. This is, in fact, a problem of epidemic proportion among the baby boomer generation and is a concern that cannot easily be fixed in the short term.
We all would like to have the comfort of knowing that we will have the financial wherewithal to begin our next phase of life, whatever that is. In this situation it is best that we sit down one on one to discuss your goals and plans, and examine your financial resources and needs, and develop together a plan to implement changes where needed. It is our goal to deliver peace of mind.
The reality is, whether you own a business or not, you should have a well-diversified balance sheet. Areas that should be evaluated include:
- Your personal and retirement plans and goals
- Maximizing retirement account savings and any company match
- Regularly adding to your diversified investment portfolio
- Knowledge of what your Company and other assets are worth
- Effective use of College Savings (529) Plans, where appropriate
- Life insurance – too much, too little, outdated policies?
- Long term care needs
- Comprehensive estate plan (I will cover this more in a subsequent article)
Peace of mind can only come through being properly prepared. Please give us a call to let us help you make sure you are on the right path.
In our next issue I will review how to prepare your Company’s financial position to maximize the value for a sale or transition.