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I've Sold My Business. What Now?

Plum Pointe Wealth Management President Brian Dunckley discusses five steps to navigating the transition period during and after the sale of a business.

Watch the video or listen to the full audio episode here or on your favorite podcast app.

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AFTER YOU SELL YOUR BUSINESS: 5 STEPS TO SECURE YOUR FUTURE

Selling your business is a pinnacle moment. Years of dedication and relentless drive have culminated in a successful exit. It's a time for celebration, a chance to reflect on your accomplishments, and a well-deserved break from the day-to-day. But beneath the surface of exhilaration lies a hidden undertow of uncertainty. What happens now?

This is a significant life transition, one that requires careful planning and a strategic approach. Your identity has likely been intricately woven into the fabric of your business. Letting go can create a sense of loss and raise questions about your purpose moving forward. Additionally, the financial windfall you receive presents its own set of challenges. How do you manage this newfound wealth? How do you ensure it translates into a secure and fulfilling future?

At Plum Pointe Wealth Management, we understand the unique challenges you face. Our President, Brian Dunckley, has extensive experience working with business owners, and is himself an entrepreneur. He's had firsthand experience building a business, managing risk, and navigating the intricacies of payroll and employee management.

While every situation is unique, Brian and Plum Pointe Wealth Management have developed a 5-step process to guide you through this important life transition. These steps provide a roadmap for navigating the post-sale landscape and setting yourself up for long-term success.

STEP 1: CHARTING YOUR COURSE – ENVISIONING YOUR IDEAL POST-SALE LIFE

For many business owners, the business is more than just a source of income, it's an extension of self. It embodies their vision, their relentless drive, and the countless hours poured into its success. Selling it can feel like severing a vital connection. This is why the first step on your post-sale journey is introspection. Take time to envision your ideal life post-sale.

What ignites your passion? What activities bring you joy and fulfillment outside the realm of your business?

How do you see yourself spending your time? Do you dream of traveling the world, volunteering for a cause you care about, reigniting old hobbies, or pursuing new ventures? Perhaps you have a burning desire to learn a new skill or finally write that novel that's been brewing in your mind for years.

Do you envision spending more time with family and friends? Amongst the many sacrifices business owners make, sometimes time with family may be very limited while running a business. Amongst the many sacrifices business owners make, quality time with friends and family is often at the top of the list. Post sale, many owners prioritize connecting with friends and friends.

STEP 2: BUILDING A SOLID FOUNDATION – DEVELOPING A TAX PLAN

There's no escaping the fact that the sale of your business will have tax implications. The nature and extent of these implications will depend on various factors, including the structure of your business, the sale price, and the way you receive the proceeds.

To navigate this complex landscape, working with a qualified financial advisor and tax professional is paramount. They can help you understand your tax obligations, develop strategies to minimize your tax burden, and ensure you're following all legal guidelines.

Remember, tax planning is not a one-time event. As your financial situation evolves, your tax strategy may need to adapt as well. Regular consultations with your financial advisor will ensure you're taking advantage of all available tax-saving opportunities.

STEP 3: FROM CASH TO CLARITY – MANAGING YOUR LIQUIDITY EVENT

Suddenly having a large sum of money at your disposal can be both exhilarating and daunting. The financial decisions you make in the wake of your business sale will have a significant impact on your future. This is why a well-defined plan for managing your newfound wealth is crucial.

Here are some key considerations:

Income generation: Did your business provide a steady stream of income? If so, you'll need to develop a strategy to replace it. This may involve creating an investment portfolio that generates income through dividends, interest, or other sources of income.

Preserving wealth: Your primary goal should be to ensure your wealth lasts throughout your retirement years. This means striking a balance between generating income, realizing growth and protecting your principal from inflation and market volatility.

Distribution of wealth: Do you have children or other beneficiaries you'd like to include in your wealth distribution plan? Estate planning strategies like trusts can help you distribute your wealth in a tax-efficient manner.

5 Steps to Secure Your Future PDF

STEP 4: TAKING CARE OF BUSINESS – ADDRESSING PRACTICAL CONSIDERATIONS

Selling your business creates a domino effect of other practical considerations that require your attention. Don't hesitate to seek guidance from qualified professionals like financial advisors, attorneys, and accountants. Here are a few key areas to address:

Health insurance: If your health insurance was previously tied to your business, you will need to ensure you remain adequately insured without any gaps in coverage.

Personal benefits: If your business was supporting aspects of your life like a vehicle allowance or a set entertainment budget, you want to work those costs into your plans.

Policies and agreements: Work with your advisors to ensure all existing policies and agreements (like buy-sell agreements) are reviewed and updated (or terminated if no longer needed) to avoid any gaps or risks during the business sale transition.

STEP 5: BUILD PEACE OF MIND – SECURING YOUR LEGACY

Now's the time to look at your finances and your vision for the future. Finalize and complete your plan and make sure that whatever your legacy is, whatever is important to you, whether it's caring for your family and your children or giving to a charitable organization, it's time to implement those strategies and secure that legacy.

The planning you do now at this early stage will impact your wealth—positively or negatively—for the rest of your life. Review your assets with a financial advisor to ensure there aren't any unforeseen risks now that your portfolio has changed.

TAKING THE FIRST STEP

If you're nearing the sale of your business, or are already in the post-sale phase, don't go it alone. Financial advisors like the team at Plum Pointe Wealth Management can help you through this transition. By following these steps and seeking professional guidance, you can ensure a smooth and successful move into the next chapter of your life.

For more information on how Plum Point Wealth Management can assist you, give us a call and set up a free consultation today at 401-228-8258 or email us at info@plumpointewealth.com.

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