If you own a business and your family depends on it for their income, you cannot afford for it to grind to a halt when something happens to you.
Estate planning can help you prepare for a debilitating illness or death. Here are some things to consider putting in place:
Powers of attorney
Who will sign legal documents such as contracts if you cannot? Who will access bank accounts to pay bills? You can set up powers of attorney that only come into play when needed. That way, things can roll on without you in family and business life.
Who will take charge?
Let’s say you want your daughter to take the helm of your business when you step back from it. Currently, she has another three years before graduating. What happens if you pass away tomorrow? Do your other children know that it is her you want to take the controls? Have you put that in a legal document so no one can dispute it? Does she have the knowledge of your company she needs to step right in or a good support team with that specific knowledge?
A succession plan is crucial, and you should have a few variations. A long-term one for if you get to retire when you plan, and a short-term backup in case something goes wrong sooner.
What about taxes?
There are ways to minimize any taxation that will occur on the transferral of your company. Failing to use them is throwing money away and could make it harder for the business to survive.
There is a lot to consider when planning for the future of you, your family and your business. Seek legal help to ensure you understand all the options.