Detroit residents put a lot of money and time into developing their businesses, often making as much of an investment into their company as they do into their children. Just like with one’s children, one wants their business to remain profitable and successful even after one is no longer there to provide guidance. But people only end up setting their children up for success through estate planning, not their businesses. Successful business owners should be thinking about the steps they need to take to keep their businesses run on after their own passing.
The biggest concern most entrepreneurs have is how to ensure their business keeps running regardless of their own stage in life. This is often difficult to think about and people often put off making the important decision of who will run their business when they cannot. However, its always better to have this decision made while one is still in charge, rather than leaving others to make it. There are many benefits of making this decision in a timely manner:
- It prevents people from arguing with one another at a later date. With everyone knowing their exact role in the business, it is more likely they will work amicably with one another rather than argue with one another.
- It becomes possible to train the successor and prepare them for the role they will eventually inherit. It can also help everyone become comfortable with the new person.
What should a business succession plan include?
The most important part of the business succession plan is including the successor who will seamlessly take over the running of the company when needed. Additionally, the company could be transferred to a trust to prevent it from going through probate and ensuring that it goes to the chosen beneficiaries. Estate tax might also be minimized through a trust.
Succession planning for a business can be complicated, especially when one is already dealing with the complexities of running a business. Consulting an experienced attorney for guidance on how keep the business running smoothly in the long run can be beneficial.