Thursday, January 22, 2015
Passing on the family business to the next generation includes many challenges and takes persistent succession planning to ensure both the success of the business and the next generation management. Here are three tips for succession planning:
- Compensation and inheritance can become intertwined when bringing in young family members to the family business, but should be kept separate to ensure the younger successor is an invested member of the business and learns the value of a strong work ethic.
- The process of training the next leaders of the family business is a valuable opportunity to teach them lessons not only about running the business, but also financial planning and how to achieve financial security.
- Throughout the succession planning process, it is important that the plan is clearly communicated, but also flexible enough to adjust to unplanned life events.
See Nicholas Fedele, Succession Planning for Family Businesses, Wealth Management, Jan. 20, 2015.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.