Plan Your Legacy

Building your wealth took significant time and effort.

As such it’s also worth giving careful thought to establishing a strategy for transferring your wealth to future generations to preserve its value and uphold your family legacy.

Succession planning is crucial for organizations to guarantee seamless leadership transitions and operational continuity yet the vast majority of SMBs don't have a plan.

Laying the foundation
It's never too early to start planning for succession. Beginning early gives you ample time to develop a suitable exit strategy, select the right successor, and train them to manage the daily operations of your company.

Consider the following points to establish a strong foundation for a successful succession plan:

1. Value Your Business
Calculating the worth of your business is crucial for succession planning. Various techniques exist for business valuation, and the most appropriate method depends on your business circumstances. A qualified professional can help you select the right valuation strategies.

2. Plan Your Exit Strategy
As a retiring business owner, it's essential to plan your departure from daily operations. A solid exit strategy ensures a smooth transition and facilitates the transfer of ownership.

3. Choose a Successor 
If you plan to keep ownership and control within the family, start by assessing family members’ interests and qualifications and how well they match the business's needs. Discuss with family members who will participate in the company and in what capacity. Decide on compensation for working members and provisions for non-participating members. If you plan for unrelated parties to continue the business, meet with key individuals to discuss the company’s future. If succession involves selling the business, address issues such as purchase price, payment terms, and the activation timeline for the succession plan.

4. Develop a Business Plan for the Future
Outline clear short-, medium-, and long-term business goals for your successor, along with an action plan to achieve them. Include adaptable budgets and financial forecasts based on industry and economic conditions.

5. Choose a Transfer Strategy
Depending on your business type, its value, and your personal financial situation, determine the best ownership transfer strategy. There are various ways to structure and fund buy-sell agreements. For transfers to family members or charity, gifting may be suitable. Consult tax and legal professionals for specific guidance.

6. Plan for Contingencies
‍Prepare for unforeseen events, such as death or disability, by compiling current information even before finalizing your succession plan.

This information should include:   
- A copy of your current business plan   
- Job descriptions for all positions, detailing responsibilities and delegation of duties   
- A list of potential successors   
- A plan for extensive hands-on training for your designated successor   
- An estate plan addressing federal and state estate tax obligations

7. Other Considerations
A comprehensive succession plan should address financial, legal, and tax issues, such as:   
- Securing funds for a successor to buy out a retiring, deceased, or disabled owner’s share   
- Managing estate planning issues   
- Minimising gift taxes from transferring company stock to family members   

These considerations can be addressed with guidance from qualified legal, tax, financial, and insurance professionals.

Ensure your business continues to thrive after your retirement or in the event of death or disability by creating a comprehensive succession plan. Proper planning provides long-term security for your retirement, your company’s future, and your family.

With extensive expertise and a streamlined workflow, we provide documentation, financing resources, and hands-on support to help you make informed decisions. You will receive personalised assistance from a dedicated team member throughout the transition process.

Sell, buy, merge or find a continuity partner with an annual subscription of only £500 with no finder's fees, commissions or transaction costs.