From Retirees to Entrepreneurs: Business Succession Planning

 

The late Dr. Stephen R. Covey once wrote: “Live out of your imagination, not your history.” As one of the most influential people in our times, his words ring true for many retirees who have become entrepreneurs later in life or are trying new businesses in their later years – they are stepping outside of the retirement box.

Retirees are tapping into new ways to spend their time and for one Naperville, Illinois resident, the rewards are sweet. Lou Toste O’Brien, 73, began making cannoli cakes for her family as a hobby, but their popularity launched a business. According to an article in the Daily Herald, her business, Grandma Toste, is a growing brand in Chicagoland.

The Kauffman Index of Entrepreneurial Activity, a leading nationwide business creation indicator reports a 46% increase from 1996 to 2011 in those aged 55-64 starting businesses. A Retirement Confidence Survey released earlier this year by the Employee Benefit Research Institute (EBRI) shows that, of the polled retirees who work for pay, 92% do it to stay active and almost 60% work to take care of financial needs. New business creation prompts the need for a business succession plan.

A comprehensive estate plan will include provisions for transferring assets and ownership of a business. An experienced attorney in business law and estate planning is a great advocate for crafting a plan to protect the legacy of seasoned and novice entrepreneurs. Proper business succession planning will address the need of the business owner to:

  • Minimize tax liabilities
  • Provide annual gifts of stock or assets
  • Explore transfer strategies
  • Establish a timeline for transfer
  • Select competent succession leadership

Whether you are stepping into the business ring for the first time or have built and maintained a successful venture for decades, an enforceable business succession plan is vital.

You have worked hard to grow your business. Take the proper steps to pass on your spirit of entrepreneurship to future generations. If you have not included your business in your estate plan, contact a DuPage County estate planning attorney in Illinois today.