Many business owners spend a lifetime building a business without considering the range of life events that could impact their business succession planning. Although some business owners have put together buy-sell agreements on the advice of their corporate attorney, it’s not a bad idea to review your plan with someone experienced at drafting business succession planning documents.
When designing a business succession plan, you need to carefully consider each life event that may impact your business and the impacted owners.
Your plan can include many factors
Although death is a common life event addressed by buy-sell agreements, other factors can be just as important to consider.
Did you know that over one in four 20-year-olds will become disabled before they retire?1 And what happens if one of your business owners becomes permanently disabled or goes through a divorce? If your buy-sell agreement does not cover a range of common life events it could place your entire business succession plan at risk.
One life event can change everything
It is important to look at what can happen under your current plan or work to create one that fits your specific needs. If certain life events are not covered, it might be worth reaching out to your local marketing representative to meet with an attorney who specializes in business succession planning.
1Social Security Administration. https://www.ssa.gov/pubs/EN-05-10029.pdf. Disability Benefits. Accessed 10/29/24.
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This article is for general information and risk prevention only and should not be considered another other offer of insurance or legal, financial, tax, or other expert advice. The recommendations herein may help reduce, but are not guaranteed to eliminate, any or all losses. The information herein may be subject to, and is not a substitute for, any laws or regulations that may apply. This information is current as of its publication date and is subject to change. Some of the services referenced herein are provided by third parties wholly independent of Federated. Federated provides access to these services with the understanding that neither Federated nor its employees provide legal or other expert advice. All products and services not available in all states. Qualified counsel should be sought with questions specific to your circumstances. All rights reserved.
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