The Business Transition Blog

4 Financial Strategies For Aging Entrepreneurs

Many entrepreneurs are planning to retire on the proceeds of one stock – their own business. However, there is a disconnect in that plan for most business owners. The chances of you finding a buyer for your business are probably only 1 in 5 or less and the chances of getting the amount you want are even slimmer. The reality is, the odds are stacked against you finding someone willing to buy your business.

So we recommend a four-pronged approach to preparing for your retirement or premature demise.

  1. Grow the attractiveness and value of your business so you improve your chances of being the one in five that finds a buyer.
  2. Build the sustainability of the business so it can carry on in your absence and provide a predictable income stream whether or not you are able and willing to go to the office.
  3. Make sure you have enough life insurance to sustain both the business and your family/spouse while they recover from the shock and implications of your premature death.
  4. Pull money out of the business to feed your RRSPs or non-registered investments.

For another perspective on this, go to this Globe and Mail article.

The process of doing points 1 and 2 above so you can afford to 3 and 4 is part of our Business Transition Coach Forum™. If you want to know more, give us a call.