Business planning for retirement during the ‘Great Resignation’ – InsuranceNewsNet

Maybe you’ve heard of the “big quit” or other issues of workers leaving the workforce recently. Business owners planning their own retirement are not exempt from the desire to perhaps join their ranks.

In fact, business owners can sometimes feel stuck. Perhaps they would like to resign or retire, but cannot because of their responsibilities to customers and employees, leases and suppliers.

The latest figures from January showed 4.5 million people voluntarily left their jobs last November. The Job Openings and Turnover Survey, also known as JOLTS, reports that more than 20%, or nearly 33 million people, have left their jobs since April 2021. The COVID pandemic -19 has also pushed millions of workers into early retirement.

According to the Federal Reserve Bank of St. Louis, more than 3 million more people have retired. An article in Kiplinger’s at the height of the pandemic states that “Covid-19 weary business owners need a succession plan”.

Just as in financial planning, when advisors advise their clients to plan for the inevitable, so should business owners. That’s why the State of Colorado’s Office of Economic Development and International Trade, along with a host of other advisory groups and the Exit Planning Institute, launched a survey of homeowner readiness. to help business owners determine how to exit their business.

There are 10,000 baby boomers turning 65 every day and this generation owns 51% of private businesses in the United States. In recent surveys, 3 in 4 business owners “deeply regret” their decision to sell within a year of exit due to a lack of “preparation”.¹

Private companies headquartered in Colorado could benefit from creating an estate plan. Here are some tips to help business owners plan for the future:

Create a contingency plan in case of illness or premature death.

Form an advisory team with your lawyer, CPA and financial advisor.

Consider adding industry experts, outside advisors, and a family member to your board.

Review the financial statements. Know your income, expenses, assets and liabilities.

Consider a business valuation study.

Understand the structure of your business by who owns it and how you file your taxes.

What are your roots, your business plan and your future goals? These can help you identify an appropriate transition.

Business has a better success rate and smooth succession when you have time to plan, choose your advisors and develop your successors. Nobody likes an emergency exit. Planning ahead to be prepared will help you with your day-to-day operations and give you a roadmap to guide you through the next steps.

Our state’s economy thrives when businesses thrive. There are resources to help you improve your preparedness and advisors to help with financial reviews and assessments. Now is the time to prepare for your own future, even many years away. You don’t want to be caught out in an emergency and not be able to protect your legacy, your family and your employees.

1. Colorado State Office of Economic Development and International Trade

Patricia Kummer has been a Certified Financial Planner and Trustee for over 35 years and is Managing Director of Mariner Wealth Advisors, an SEC-registered investment adviser.


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