Category: Exit Planning

Buying & Selling a Company, Exit Planning

Why it can be so hard to sell a business

Gregory Pearl

It’s all about supply and demand. Here are some facts. About 4.2 million companies or 70% of all businesses that employ more than one person are owned by someone who is aged 53 or older. Around 8,000 people turn 65 every day and this isn’t changing for a while. Until the baby boom cohort is done. Most business owners have delayed selling their business because of the terrible economic recession starting in 2008. They were and are waiting for better market conditions. Here are some more facts. Private Equity Groups (PEGs) own 7,700 to 8,000 companies. By definition, a PEG…

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Alternative Investments, Exit Planning

Yet Another Reason Why Indexing is Best for Most DIY Investors

Gregory Pearl

Patrick Luo is a doctoral student at Harvard. He published a new study that supports the idea of just how hard it is for the average investor to achieve returns better than the market when trading individual stocks. The paper is called: “Talking Your Book: Evidence from Stock Pitches at Investment Conferences”. His research shows that well-known hedge fund managers – those private investment firms that often control billions in investment funds –  often publicly pitch the stocks they currently own as great investments. Then, after the stocks rise quickly due to the publicity, the hedge funds will sell them…

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Decision Making, Exit Planning, Tax

Why is an Asset Protection Strategy Critical for Your Business?

Timothy Foster

Most business owners that I meet are surprised to learn that just because they operate their business as an incorporated entity (S-corp or C-corp) or an LLC, their business and personal assets are NOT “automatically” and “fully” protected from business or personal litigation. Ignorance is bliss, getting a hard reality check from the hungry litigators in an overpopulated legal system is a difficult lesson to learn. Take note – if you’re not prepared – the legal system can be brutal and unforgiving. We get too many phone calls from business owners who are facing litigation from an event that’s already…

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Decision Making, Exit Planning

How To Calculate If Your Retirement is Fully Funded

Gregory Pearl

What does “fully funded” mean? It means you have enough money to provide the retirement you want to have for the length of time you need it to last. I talked about this topic in an earlier post though in a more general way.  This article points to some of the specific techniques you can use to know the answer to the above question. It doesn’t give the mathematical detail on how to do it, but simply the direction. I said mathematical because at its core this is a calculation. As with all calculations forecasting the future, the results are…

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Exit Planning

Why Does Your Family Business Need a Succession and Exit Strategy?

Timothy Foster

Many owners of a privately held business want to transfer their life’s work – the business – to a family member. There are many tax, legal and other considerations to consider.  You want to do what’s best for your family but also should not lose sight of your own goals and objectives.  And, there may be delicate family relationship issues to consider. In such a transaction, an intra-family business transfer these factors should be considered.   Benefits of a Family Business Succession Plan Minimize taxes to both generations and the business itself Maximize wealth building and retirement income Plan for…

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Decision Making, Exit Planning

How Much Money Do You Need to Retire?

Gregory Pearl

A very critical part of an Exit Plan is determining how much money you need to retire. Or another way to ask the question is how long the money you have now will last given your current spending and goals. Money may not buy happiness but it can buy freedom and security. And those two things contribute significantly to being happy. Money also reduces being sad, according to academic research. Perhaps because having it gives a sense of control over your life and who doesn’t want that? Money is a difficult subject for most people to talk about. It is…

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Exit Planning, Tax

Tax Planning is a Critical Component of an Exit Plan

Timothy Foster

Consider This Typical Scenario: Business owner commits decades building a profitable and successful business. As you know, those years have been filled with personal and family sacrifice, long hours, sleepless nights, and countless employee issues. That effort has produced a profitable and growing business, a loyal and well trained group of employees, and a consistent customer base. Without realizing it, one of the other and perhaps most costly sacrifices that Business Owner made was NOT utilizing advanced tax planning to use the business as a tool for properly building Personal Wealth and Retirement Planning. It really wasn’t Business Owners fault;…

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