Why do businesses fail after the first generation?*
Most business owners say they have chosen a successor, but only about half claim to have
a written succession plan in place. This might explain why one of out four say their successor is not aware they are the chosen successor.
How will you divide the business assets in the estate?
Estate planning is of much higher importance when it is positioned in terms of a fair and equitable distribution of assets as opposed to the handling of estate taxes.*
Estate planning is of much higher importance when it is positioned in terms of a fair and equitable distribution of assets as opposed to the handling of estate taxes.
Estate equalization is a strategy to help resolve this issue. It involves equalizing the estates of those working in the business with those not working in the business by using other assets, such as real property, cash, or a life insurance death benefit.
The process has begun for some but few have seen it through*
This is a process that begins and ends with sound exit planning. Unfortunately, only 35% of business owners have started this process, and of those who’ve started, only 8% have completed it.
Exit planning is a verb — an action. It’s an ongoing, comprehensive strategy that allows business owners to leave their businesses when they want, for the money they need, and to whomever they choose.
Though 95% of owners in this sample agree that transition planning is important, 32% of them indicated they have spent little to no time on their transition plan because they are too busy growing their company.*
While nearly 25% of respondents indicated it was important but not urgent as they or their company are still young and growing. The family also plays a factor, as 9% of respondents indicated they were simply passing their company to the next generation. Lastly, and perhaps most importantly, nearly 10% of owners indicated they did not understand how to start.