At the time I’m writing this, it was only a few months ago that I personally sold my former business, so the concept is very fresh on my mind.
There are several “numbers” that I could be talking about in the title of this blog entry. It could be your profitability number. It could be your sales price number. But in this case, the number I’m referring to is the amount of savings you would need to retire, which happens to be a moving target.
Several years ago I realized that trying to manage your own retirement plan without professional help was truly a chore. Unless you have formal training in financial planning, and I don’t mean what a typical finance or accounting professional gets in school but rather true investment management training, then there are way too many moving parts to do your own plan justice by yourself. After you are starting to feel that your investments have accumulated to a sufficient point, it’s time to bring in a professional to help you make decisions.
Even if you don’t currently plan to ever exit your business, you need a professional financial planner to help you plan for it... because it truly is inevitable. Whether you come upon hard times, have a medical situation that causes you to need to exit, or you simply get tired of your business, you need to have a plan. A talented financial planner can help you determine what you would need in terms of retirement resources to retire eventually, as well as help you plan for potential pitfalls such as health issues or other unplanned life events along the way.
Since you are thinking it anyway... no, I’m not selling life insurance or other investment products. I’m simply a business owner and now a business coach that has seen too many owners not take the time to engage a financial planner and figure out their “number”. Many of us don’t want to think about leaving our business because we enjoy it so much, but inevitably there does become a time when you exit, and not knowing what it would take is a problem. At a minimum it’s a delay, but in some cases it causes true hardship.
Even if your primary asset is the value of your business (which is usually the case), you should still sit down with a financial planner and discuss what it would take to retire someday. No matter how far out that date is, knowing what it would take gives you a target to shoot for even if you decide not to do so later.
Knowing your number only takes a little bit of time, and a little bit of money. Find a good planner. You will be thankful you did so later.
Mark Goldman
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