You’ve spent most of your time on the two great endeavors of your life, both raising your family and growing your business. They will each likely have some hardships when you’re no longer around to take care of them, but you can ease the transition by planning for the future now.
Only 23% of family businesses have a complete succession plan in place, yet 69% plan to see the company pass down through the family tree. This can leave an array of complications when the time comes, including a mismanaged company and family disputes. You could head these problems off before the issues arise by taking some time to analyze what’s best for everyone and incorporating it into a little preliminary planning.
Doing what’s best for your family and business will take a fair amount of consideration:
- Delegation: You’ll have a number of options for handing over management roles. You may want to designate someone to fill your shoes, several people to share responsibility based on their strengths or find a non-family member to step in for the immediate future.
- Ownership: Being a part of the business isn’t all about managing divisions. You can determine who will continue to profit and whether they need to offer any contribution. Shares could entitle them in a portion of decision-making, or simply allow them to benefit from the company’s existence.
- Planning: Once you have made your decisions, you may want to look into options for handing things over. Systems like a family limited partnership could continue to provide for you when you retire and offer protections to the assets you’re holding. This can leave them in better shape when your plan hands assets to named beneficiaries.
Make sure your family and your business are taken care of when you’re gone. Answering the important questions now will take the burden off them to do so later.