National Small Business Week happens every June. It's a time to celebrate the achievements of our country's entrepreneurs!
Most insurance agents, myself included, have one main message for savvy business owners: What's your business continuation plan? You'd be surprised how many smart, successful business owners shake their heads because they don't have an answer. I want to help give you one. Let's start with a few important questions.
Questions to Ask Before You Plan
Before we talk about buy-sell agreements or insurance, I need you to think about the answers to these questions:
- Is there a specific time or age at which you want to retire or otherwise exit your business?
- If you became sick or disabled and couldn't work any longer, would you have enough saved to maintain your standard of living?
- Are you depending on the sale value of your company in order to retire?
- Who will you hand the business over to when you retire?
- Who are the key employees at your company? How much would your profits diminish without that person or people?
- What are your plans for retaining these key employees?
- What happens to the business if you pass away suddenly, before retirement? Have you discussed this possibility with any partners and their families?
- Would you want to be partners with your business partner's wife or children?
These aren't easy questions, and you may not have instant answers. But it's important to think about them before beginning to make your business succession plan. Your answers to these questions will influence your financial and legal plans for the future of your company. They may also affect the way you plan your personal finances, too. In the video below, you'll meet a family whose combination of personal and business-related life insurance ensured their dream lived on.