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As a business owner, you understand you won’t operate your business indefinitely. Whether your transition will happen in a few years or a few decades from now, your business deserves to have a succession strategy in place today. Why? Succession planning is more than creating a plan to transfer ownership. When you have a plan in place, clients, partners and suppliers will have confidence in the stability of your business.
Our Farm Bureau agents and advisors can help you clarify your succession goals, build a business succession plan, manage your risk and adjust your plan (as growth happens.) We can offer assistance with the following vehicles to make succession planning and transitioning smooth.
Many business owners have a child or other family member interested in taking over their business. A family buy-sell agreement gives your business heir the first option to buy the family business from heirs who are not active in the business. You can set favorable contract terms to make the purchase more affordable, yet still provide fairness for your non-business-owner heirs.
If you own your business with a non-family partner, a buy-sell agreement can ensure the orderly transfer of your business interest upon your exit. The agreement will clearly state how the business assets will be valued and transferred, helping to protect the future of your business and provide fairness to your family.
In addition to succession strategies for your business, you may want to consider the following provisions to ensure your vision and legacy lives on:
The unexpected loss of a key employee or manager can hurt your business – lost income or profit, disruption of management and costs incurred to replace the key employee are just some of the areas that could feel the effect. Key Person Insurance can protect your business from the unexpected costs of losing a key employee and provide needed funds when it matters the most.
You can provide an attractive fringe benefit for your key employees, designed to retain your best and most valuable employees and embolden their loyalty. Be selective – pick and choose only the employees that help build the success of your business.
After building a successful business, a charitable remainder trust (CRT) can help you transition some of your assets into retirement income, thus reducing your tax burden, increasing your retirement income and allowing you to make a generous gift to your favorite charities.
At Farm Bureau, your business is our business. We take a vested interest in making sure that your business operates smoothly, and that you have the right protections in place for you and your employees. We are your trusted partner, now and planning the future of your legacy.
It’s your future. Let’s protect it.®