Small business owners think differently about retirement than other executives. Your business’s assets and savings all play a key role in your retirement strategy.
SunTrust Business Owner Research found that more than 70 percent of owners count on either the sale of their business or savings it generates to fund their retirement. Consequently, having a plan for building and monetizing your business asset well before you plan to leave your business must be a key part of your retirement strategy.
The challenge for business owners is that many financial advisors traditionally involved in retirement planning focus only on narrow aspects of the retirement formula, such as investing non-business assets, securing insurance and handling the sale of a business. So it’s no surprise that SunTrust research found that less than five percent of business owners identified their investment advisors, business brokers and insurance agents as the best resources to build the value of their businesses before they retire.
You need to consider your entire financial picture when assembling a team of financial professionals. Your team should help build your business asset, while growing and preserving your personal investment portfolio. Ideally, your checklist for financial partners includes those who:
- Understand both sides of your balance sheet — assets and liabilities
- A solid team identifies solutions that give you access to the working capital you need without compromising your personal cash flow needs or investment opportunities.
- Value businesses as a growth asset
- Have informed research and insight related to your industry to include comparables and value drivers
- Provide tools and advice to help optimize your time, cash flow, cost control and revenue growth
- Offer a range of professional and advisory services for retirement planning, credit, trust, cash and risk management
- Deliver financial strength and staying power, you can trust and depend on over time
Keep in mind that you are unlikely to check all the above boxes with one person. Your team often will include advisors or bankers who specialize in a particular area, such as business banking or private wealth planning, but understand how to work together to address your needs. As a business owner, your needs holistically should include plans for your business and personal assets.