YOUR EXIT STRATEGY - AND HOW IT RELATES TO BUSINESS PLANNING. Business owners and executives are always coached to have an "Exit Strategy" with their career and their business. An exit strategy is a structured plan as to the many scenarios a business / business person might encounter. The theory is that it should be assumed that a business is going to last for a certain period of time, and/or that a business owner is only going to want to be involved in that business for a fixed amount of time. If a business owner is planning to exit the business in 5 years, he needs to have a bunch of answers in place to make that transition smooth:
- Am I going to close the business or sell it?
- Do I want to sell for cash?
- Will I keep some stock?
- What are the tax implications of taking cash or stocks?
- Do I want to continue on as a consultant?
- How do I sell the business?
- Who will I hire to help market the business?
- Who do I sell the business to?
- ETC
If you don't have a plan for these important questions, you're more than likely going to stumble through the process and not receive all of the benefits of exiting your business. Death planning and life insurance are similar Although it's not a natural or pleasurable task to plan for your death or your loved one's death, it's something that should be looked at in a business like manner. I found this article. where this gentleman was in the life insurance business by trade and also had cancer. He went through the planning stages in a more business like fashion.
"I was looking for a quiet place to die," he tells us. Naturally, he chooses Brooklyn � otherwise, Paul Auster would have had to give his new novel a different title. Nathan is pushing 60, divorced, alone, and likes it that way. He's sort of a Misanthrope Light. He also has cancer, which is why he figures it might be time to get ready for a transition by making a transition. Nathan made his living selling life insurance, so he knows all about actuarial tables; he might live for another 20 years, he might live for six months. Either way, Nathan will be prepared. Having found a decent place to live in Park Slope, Nathan begins to write what he refers to as The Book of Human Folly, a roster of the disasters he has brought on in his rapidly deflating life. Since he grows weary just compiling his own stupidities, he begins writing about other people's as well. When not immersing himself in mankind's manifold failings, he takes long walks through the neighborhood.
It's refreshing to see the "matter of fact", business like approach that he's taking to getting his finances in order. Recently, my aunt, age 74, was diagnosed with cancer. She was given 2-6 months to live. She was instructed by the doctor to get her household business and her finances in order before her death. Her situation struck me a little closer to home as she is my mother's sister. I thought to myself.. My aunt is 74, she's got cancer, she probably feels terrible physically and emotionally, and at the same time she's got to think about selling her house and all her property she owns. She's got to think about estate taxes, and wills for her heirs etc. Is that really the time you want to start thinking about that? Not really... At a time like that, you want to simply execute all of the plans you've put into place prior to that. It's a pretty hard and emotional topic. If you or your loved one dies before your time, these matters will have to be dealt with anyway. The least stressful way is to plan for this eventuality before hand.
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