Running your business takes a lot of consideration and careful decision-making on a daily basis. It’s no different when it comes to designing your estate plan, and how the small business you worked so hard to build up will fit into it. Here are a few options for you to consider while you’re planning what will happen to your business after you’re gone.
Selling the business
If you don’t have a particular beneficiary that would like to continue on your business, the best option might be to have it sold upon your death. That way your executor (the person who administers your will) can divide the proceeds of the sale to all of your beneficiaries equally.
Succession planning
If you do know who you want to take the reigns of your business once you’re gone, then it’s time to develop a thorough succession plan. This will help you to ensure that there is a smooth transition of power from you to your chosen successor, and that they are prepared to take on the responsibilities of ownership and directorship.
Putting the business in trust
You don’t want your business to come to a grinding halt if you are taken suddenly and unexpectedly from the world. That’s why placing your business in a trust is a prudent step. By doing so, you can ensure that your business will continue to function smoothly, and that your trustee (the person administering your trust) will guide it according to your established plan.
Train your executor and trustee
Your executor and your trustee have extremely important roles to play in the administration of your estate plan. As such, it’s much better if they don’t learn of their responsibilities once you die.
If at all possible, have a discussion with them about your expectations now. That way, they will have the opportunity to ask you any clarifying questions and prepare themselves, and they’ll know exactly what to do when the time comes.
You didn’t get this far in the business world by being sloppy or undisciplined. You know what it takes to make a company run smoothly. By taking these few simple steps, you can help to protect your business, and ensure that it continues to function as intended, after you’re gone.