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Three Things to Do Today to Plan for Tomorrow

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Dave Johnston

How Business Owners Can Prepare for Retirement

Business owners certainly have a great deal to think about. As they evaluate tools, strategies and protocols, I encourage them to also think about long-term stability for their future. I understand that it may feel daunting, so I suggest starting with three steps.

1. Define or Revisit Your Exit Strategy.

If you’ve already created an exit strategy for your business, you may have made plans to pass your business to a family member, or sell your business to a key employee, competitor or outside party.

Ask yourself the tough questions to ensure your plan stills holds up: Does my plan contain an accurate business valuation? Has my business valuation changed due to the pandemic? How do I find suitable buyers with the changing market conditions? Do I have a Buy-Sell agreement with my partners that will protect me and my family? Do you have a plan if a medical issue or disability requires changing ownership? How will the Buy-Sell agreement be funded?

When you’re ready to refine your exit strategy, partner with a wealth advisor, since they will have the expertise and vision to help you create and execute your plan. The right partners will help you find the right agreement and plan other details along the way.

2. Diversify Your Retirement Plan.

Many business owners are driven to reinvest their profits back into their business. While your small business may be a significant part of your retirement plan, it is critical to diversify your assets. It is important to have an investment strategy for your other assets. One key part of this strategy is ensuring that your company has the right retirement plan. There are a wide range of retirement plans designed to meet your needs.

The basics. There are numerous small business plans that may be right for you. From SEP and Simple IRAs to 401ks and profit-sharing plans – there are many plans that have distinct advantages and disadvantages. The retirement plan you need will depend on numerous factors, such as how much money you can defer, number of people you employee and how many years you have until retirement. I recommend letting an expert help you navigate your options, because each has special features that may or may not apply to your situation.

Investment strategy. The right investment strategy and financial plan will not only help build a nest egg, but also help you plan for how much money will you need to retire, and how much income you will need to meet your retirement goals.

3. Protect your family.

It is important to evaluate estate planning options. There are several options to consider when a business asset is transitioning due to death or incapacity. Moving these assets to a trust can be beneficial for your business and family members. In addition, it is important to protect your business and family with the right insurance (such as life and disability) to protect your business investment from a variety of circumstances.

During a time with so many business decisions to make, remember to keep your retirement in mind. When you speak with a wealth advisor, you’ll gain reassurance that you are on the right track or feel more confident about the steps you’re taking today. Call or schedule an appointment with our wealth team to discuss your options and stay on track to achieve your goals.

Reviewed August 1, 2022

Written by Dave Johnston, head of wealth management

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Financial products made available or recommended by Ameris Bank that are not bank deposits are not insured by the FDIC; are not a deposit or other obligation of, or guaranteed by, Ameris Bank; and are subject to investment risks, including possible loss of the principal amount invested.