1 Exit Strategies For Business Owners. 2 Special Note - The purpose of this presentation is to provide you with a general overview of retirement, succession.

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Exit Strategies For Exit Strategies For Business OwnersBusiness Owners

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Special Note -Special Note -

The purpose of this presentation is to provide The purpose of this presentation is to provide you with a general overview of retirement, you with a general overview of retirement, succession and estate planning strategies.succession and estate planning strategies.

Clients should always consult their tax and legal Clients should always consult their tax and legal advisors for specific guidance concerning their advisors for specific guidance concerning their own situations.own situations.

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OverviewOverview The Importance Of An Exit StrategyThe Importance Of An Exit Strategy

Improving Your Succession PlanImproving Your Succession Plan

Making Your Your Exit Strategy Fit Into Making Your Your Exit Strategy Fit Into Your Retirement And Estate PlansYour Retirement And Estate Plans

Working With Your Entire Team Of Tax, Working With Your Entire Team Of Tax, Legal And Other Professional AdvisorsLegal And Other Professional Advisors

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What Is An Exit What Is An Exit Strategy?Strategy?

A Review Of Your Succession And A Review Of Your Succession And Retirement PlansRetirement Plans

Identifies Problems Before They AriseIdentifies Problems Before They Arise

Coordinates Your Succession And Coordinates Your Succession And Retirement Plans Into Your Overall Retirement Plans Into Your Overall Estate PlanEstate Plan

The Importance Of An Exit Strategy

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ExampleExample

Situation: Bob Jones and Jan Bob Jones and Jan

Smith are equal Smith are equal owners Of J&S owners Of J&S IndustriesIndustries

Issues: How Can The Owners How Can The Owners

Prepare For Prepare For Retirement?Retirement?

What Type of What Type of Succession Plans Are Succession Plans Are Appropriate? Appropriate?

How Do These Plans How Do These Plans Fit IntoFit Into Their Estate Their Estate Plans?Plans?

The Importance Of An Exit Strategy

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Your Exit Strategy Needs Your Exit Strategy Needs To Be ReviewedTo Be Reviewed

Identify Your Retirement Goals & Identify Your Retirement Goals & ObjectivesObjectives

Evaluate Succession Planning OptionsEvaluate Succession Planning Options

Coordinate Your Personal & Business Coordinate Your Personal & Business Planning NeedsPlanning Needs

The Importance Of An Exit Strategy

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Tips and StrategiesTips and Strategies

Identify & Prioritize Your Personal & Identify & Prioritize Your Personal & Business ObjectivesBusiness Objectives

Solve Your Most Important Problem FirstSolve Your Most Important Problem First

Develop A Succession Plan For Every Develop A Succession Plan For Every Business You OwnBusiness You Own

The Importance Of An Exit Strategy

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Retirement PlanningRetirement Planning

Do You Plan To Retire?Do You Plan To Retire?

How Much Do You Need To How Much Do You Need To Retire Comfortably?Retire Comfortably?

How Does Your Business Fit Into How Does Your Business Fit Into Your Overall Estate Plans?Your Overall Estate Plans?

Do You Have A Do You Have A “Retirement “Retirement Savings Gap”?Savings Gap”?

Improving Your Retirement Plan

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The Four Sources Of The Four Sources Of Retirement IncomeRetirement Income

Social SecuritySocial Security

Pension & Nonqualified PlansPension & Nonqualified Plans

Personal SavingsPersonal Savings

WorkWork

Improving Your Retirement Plan

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Business Retirement Business Retirement Strategies For OwnersStrategies For Owners

Pension PlansPension Plans

Nonqualified PlansNonqualified Plans

Personal SavingsPersonal Savings

Business Sales Or Liquidation ProceedsBusiness Sales Or Liquidation Proceeds

Improving Your Retirement Plan

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Succession Planning Succession Planning ChecklistChecklist

Understand Your OptionsUnderstand Your Options

Review Your PlanReview Your Plan

Work With Your SuccessorWork With Your Successor

Utilize Your Team Of AdvisorsUtilize Your Team Of Advisors

Improving Your Succession Plan

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Business OptionsBusiness Options

SaleSale

GiftGift

LiquidationLiquidation

Improving Your Succession Plan

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Forced Sale OrForced Sale Or Planned Sale Planned Sale

Situation:

Tom Smith Tom Smith “plans” to sell his “plans” to sell his business when business when he retires.he retires.

Issues: Who is this “buyer”?Who is this “buyer”? Will the “buyer” offer a Will the “buyer” offer a

“fair price”?“fair price”? Will the purchase price Will the purchase price

be paid in cash?be paid in cash? What happens to Tom’s What happens to Tom’s

retirement plans if the retirement plans if the payments stop?payments stop?

What happens if Tom What happens if Tom dies, becomes disabled, dies, becomes disabled, or wants to retire earlyor wants to retire early??

Improving Your Succession Plan

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The Planned SaleThe Planned Sale

Protects The Value Of The Protects The Value Of The Business InvestmentBusiness Investment

Available If There Is A Willing Available If There Is A Willing Buyer Or SuccessorBuyer Or Successor

Provides Benefit To Both PartiesProvides Benefit To Both Parties

Improving Your Succession Plan

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Gift PlanningGift Planning Some Owners Plan To Give Away Their Some Owners Plan To Give Away Their

Business During Life Or At DeathBusiness During Life Or At Death

Family Members Must Be Willing & Family Members Must Be Willing & Capable Of Running The BusinessCapable Of Running The Business

Requires A Careful Analysis Of Requires A Careful Analysis Of Retirement, Estate Planning, & Family Retirement, Estate Planning, & Family Income NeedsIncome Needs

Gift Plans Must Be Reviewed On A Gift Plans Must Be Reviewed On A Periodic BasisPeriodic Basis

Improving Your Succession Plan

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Liquidation PlanningLiquidation Planning

Not All Succession Plans Will Be SuccessfulNot All Succession Plans Will Be Successful

Liquidation May Occur During Life Or At Liquidation May Occur During Life Or At DeathDeath

Liquidation Typically Means A Substantial Liquidation Typically Means A Substantial Loss Of Business ValuesLoss Of Business Values

Prudent Planning Should Prepare For The Prudent Planning Should Prepare For The Contingency Of A Business LiquidationContingency Of A Business Liquidation

Improving Your Succession Plan

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Liquidation ExamplesLiquidation ExamplesExample One:

The Successor Quits The Successor Quits Before The Before The Retirement Sale. Retirement Sale. The Owner The Owner Liquidates The Liquidates The BusinessBusiness..

Example Two:

The Owner Transfers The Owner Transfers His Business At His Business At Death To His Adult Death To His Adult Children. The Adult Children. The Adult Children Can Not Children Can Not Run The Business Run The Business Successfully.Successfully.

Improving Your Succession Plan

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Estate PlanningEstate Planning

Complements Your Retirement & Complements Your Retirement & Succession PlanningSuccession Planning

Helps You Achieve Your Personal, Family, Helps You Achieve Your Personal, Family, & Charitable Giving Objectives& Charitable Giving Objectives

Makes Your Exit Strategy SuccessfulMakes Your Exit Strategy Successful

Your Overall Estate Plan

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SummarySummary

Your Exit Strategy Is ImportantYour Exit Strategy Is Important

It’s Based Upon The Strength Of Your It’s Based Upon The Strength Of Your Succession & Retirement PlansSuccession & Retirement Plans

It Must Fit Into Your Overall Estate PlansIt Must Fit Into Your Overall Estate Plans

These Plans Must Be Designed With The These Plans Must Be Designed With The Input Of Your Entire Team Of Tax, Legal Input Of Your Entire Team Of Tax, Legal and Professional Advisorsand Professional Advisors

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