Think back to the most important conversations in your life. Is a meeting with your financial advisor on that list? It really should be! Let me tell you why.
When my wife, Rebecca, and I began Miller Tau Financial Group together, we knew we wanted to build something of our own, something we could be proud of. The reality is, we also knew that we were embarking into a truly risky position! There are so many unknown factors you don’t control that can permanently affect the success of a business: regulations, changes in tax policy, industry-wide demand (or not) for your product service, the strength of the competition….the list goes on.
When you’re putting it all on the line, it is more important than ever to minimize the risk to you and your family in every way possible. That’s where your financial advisor comes in! No one wants to imagine the worst case scenario, but meeting with an advisor to assess risk can ensure that you never have to live it. Being prepared for the unpredictable can truly make or break your business, ensuring that your life’s work and your family’s well-being are protected, no matter what comes your way.
All it takes to get started is one conversation with a knowledgeable advisor who can diagnose exactly where you are underprepared, and then show you how to fix those vulnerabilities. You’ll sit down and discuss what truly matters to you and your business — your values and priorities, your goals for the future, and your fears. Then, you’ll build a strong defensive strategy together, putting crucial buffers in place between your business and disaster.
A few hours of expert preparation now can save you huge amounts of time, money, and trauma in the future!
Here are just a few common disasters that your advisor will help you and your business prepare for:
What if you can’t retire?
Many business owners rely on the sale of their business to support their retirement. It’s a great plan in concept — after all, you’ve poured your time, energy, and passion into your business to turn it into a valuable asset. Unfortunately, just like selling a home, it comes with many risks of its own.
How can you ensure there will be a qualified, interested buyer at the same time that you’re ready to retire? What if your industry becomes less in-demand when you try to sell? What if the best offer just isn’t high enough? How confident are you that you have an honest valuation of your business so you are not being short-changed (or, reaching too high)?
Simply planning to sell when you’re ready means leaving a lot of up to chance and accepting unnecessary risk. Your financial advisor can help you put a timeline or succession plan in place well before you’re looking to sell so that you can focus on your retirement without the unpleasant surprises.
What if you can’t work?
If you become ill and unable to work, or, worse yet, if you or a key member of your organization passes away, what will happen to your business? What about your employees? Your family? Preparing for the worst now can make all the difference for you and your loved ones if you are faced with sudden, unexpected loss.
Your financial advisor will help you develop important contingency plans for keeping your business running and providing your family with all they are entitled to — especially those who are dependent on your business’ income.
What if there’s a natural disaster?
Remember Hurricane Sandy? One day coastal restaurants and merchants were flourishing, and the next, countless family-owned businesses were devastated. Even mundane disasters can be just as destructive — Imagine, for example, that a burst pipe floods your business and you are forced to close for several weeks during expensive repairs. You may still have bills to cover (salaries, rent, etc) while your business is closed. It’s no wonder that a quarter of small businesses never recover from an unforeseen disaster. No one sees it coming, which is exactly why every business needs a backup plan in case of a hurricane or even your neighbor’s negligence.
What if you get sued?
Not even the most well-intentioned, integrity-filled small business is safe from a lawsuit. If your business is sued, will your personal assets be in danger? If they are protected, what percentage of your business assets are at risk? A lawsuit has the potential to close your doors for good. If you are ever faced with the financial and emotional strain of a lawsuit, you should at least be able to rest easy in the knowledge that the well-being of your family and your business are protected.
You’ll never be completely free from the challenges and risks that come with dedicating yourself to building something of your own, a business that represents your passions and values. With the right team behind you, however, and one crucial conversation, you can feel confident in the knowledge that you’re protected and prepared for whatever life throws at you.