If you are a business owner, does succession planning keep you up at night? Whether you’re in a partnership or a family business, succession planning can seem daunting. However, effectively transitioning your business from one owner to the next—whether that transition occurs due to a planned exit or an unexpected or tragic event—is critical.
Without a plan in place, your years of hard work could instantly be corroded.
Life insurance is a powerful tool that allows you to protect the value of your business by providing liquidity at that critical time. It can be applied to a family business, a sole proprietorship, a partnership and other business structures.
In the event of your untimely death or disability, life insurance can provide the cash needed to keep your business afloat, fund the search for a successor, provide income for your surviving spouse and furnish additional financial support.
Some life insurance policies also allow access to cash during the life of the insured, which can be used as a funding source for a lifetime buy-out of the business owner, for a deferred compensation, or to secure a bank loan.
To get started with succession planning, here are some questions to consider. If you want leave your business to your family, do you want your heirs to share equally in your estate? If you have a co-owner, have you and the other owners discussed what will happen if one of you leaves the business? If your successor is unknown, do you want your family to be taken care of without being dependent on the success of your business after you are gone?
These questions take time and serious reflection. I would love to partner with you as you work through these important details. Give me a call at 423-318-5800 or visit www.strateinsurance.com, and we will set up a time to talk.