If you are a business owner — or if you run a professional practice — it is very important that you do not put off your estate planning. Getting the results you need and protecting both your business and your family’s wealth often takes years of preparation and planning; many experts suggest starting a decade in advance.
The reasoning is that your business probably accounts for a significant percentage of your overall assetts. It’s likely the most valuable asset you control. It also represents future income. You may intend to use this income to take care of your family after you pass away.
This can be done in numerous ways. For instance, you may be interested in succession planning to pass the business on to another family member. This way, the company can keep generating income, perhaps for decades to come, and you leave your heirs far more than a lump sum. You give them careers and job opportunities, along with potential financial stability that lasts for life.
In other cases, you may opt to sell the company. Perhaps you do not have an heir who is interested in running the company or maybe you believe that none of your heirs can run it successfully. If so, then you need to understand the true value of the business to broker a fair sale that brings a sudden influx of wealth to your family. This wealth then gets passed on to the next generation.
No matter what you choose, the process can be very complex and is certainly critical to your family’s financial well-being. Make sure you understand all of the legal options you have.