Wednesday, March 21, 2018

Prepare the Owner for Retirement

As a business owner, you are no doubt used to setting goals and achieving them. Are you as good at it in your personal life? Most people who start a business do it because they have certain goals they want to achieve. Maybe they want to have the flexibility to work when they want. Maybe the motivation is to be able to build extraordinary wealth. Whatever the reason, it is far more difficult to be motivated to set goals for retirement, so only very few have given much thought to that.

Setting Goals for Yourself

This is how important it is to do: You may have about 40 or so years of work life, but you may also have another 40 years in retirement. Sure, you have Social Security, but that may only provide a small fraction of the income you need for the lifestyle you want. Forty years is also a really long time if you have nothing meaningful to do, so setting retirement goals should also have provisions for that.

Setting Goals for You and Your Family

Do not think you are done when you have set goals for yourself. Most likely, you are connected to both an immediate family and an extended family. They may have plans of their own and they may not look like yours. What do you do? You can either try to work it out with them or major upset could result. It is best to prepare for lots of respectful communication.

Do write down your own goals and plans in great detail, but be sure to write anything that is negotiable in pencil. Decide what is non-negotiable and write it with a permanent marker.

The Extended Family

Often times, people beyond the immediate family also have an interest in what you do with your business. Some of them may have expectations that never crossed your mind before. Prepare yourself mentally for surprises; even conflict.

Other Stakeholders

There may be others outside your family who have an interest in what happens to your business: Partners, vendors, customers not to mention employees if you have them. You may not care what happens to them, but more than likely you do and it is important to you, so they need to be part of your plan as well.

As you can see, exit planning is not something you can do in one day, you really need to spend considerable time on it. It is not something you can delegate. You are going to have to do it yourself, so delegate something else and get started. It is more important than most people in their 20's, 30's and 40's think.

Retirement planning is hard, but fortunately, there is plenty of help available.  Most are for employees and most deal with the financial aspect of retirement. This one also deals with the very important mental aspects. Financial security alone does not necessarily make you happy. There is more to it than that. This book helps with that.

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