By: Donna Greene, CFP®
In order to ensure a secure retirement and safeguard wealth for future generations, your business transition needs to be carefully planned. In today’s rapidly changing financial environment, business succession planning will be one of the most daunting decisions an owner may face. With an understanding of your financial objectives, and the partnership of experts in various fields, Busey Wealth Management can help you create a seamless transition plan for your business.
Bethany Hearn from CliftonLarsonAllen LLP is one of many experts we can draw upon for specialized knowledge. With over two decades of experience in business valuation, she has a keen understanding of business ownership changes. “People can make the difference between a smooth transfer of control and a damaging, or failed, transition,” says Bethany. “Transferring control can be even more complex when family dynamics and relationships enter the picture. Emotions can overpower logic and reason—and planning can break down due to a lack of communication or an unwillingness to compromise.”
Starting early is best. “Everyone who is affected by the plan should be involved,” says Bethany. “An open dialogue helps gauge feelings and expectations. As an owner, you may have always dreamed that your children would be interested in running the business. But that isn’t always the case. There may be several partners or family members from whom you will have to choose, each with various strengths and weaknesses to be weighed and evaluated. Key employees should be considered, as they may have the skills and experience necessary for the business to continue to succeed. Think about who has the desire to be involved. It is important to be as objective as possible and think of what’s best for the business.”
Whether the successor is a family member or not, planning well in advance allows time to bring them up to speed. “Working directly with that person, sharing decision making, and imparting as much knowledge and experience as possible leads to a better chance of success. You want that person to share your passion for the company.”
Proper business succession planning requires sound preparation. Business owners seeking a smooth and equitable transition of their interests should seek a competent, experienced advisor to assist them. Getting outside help when approaching the process of transitioning your business is extremely important; your lawyer, accountant, financial advisors and perhaps even family counselors can help facilitate discussions.
For business owners, the issue of succession cannot be ignored. Now more than ever, it’s crucial to develop strong partnerships to assist you in making decisions to help your business thrive for years to come. Talk to one of our professionals today and discover how your Busey Wealth Management relationship can help you make the most of your business succession plan.