Is Your Business Prepared for the Silver Tsunami?
The Silver Tsunami is a metaphor that is used to describe the time in which baby boomers will enter their retirement years, potentially affecting everything from healthcare to the workforce.
According to the U.S. Census Bureau, one in every five Americans will reach retirement age by the year 2030, which is also the year in which older people will outnumber younger people for the first time in history.
Is your business prepared for the Silver Tsunami?
All business owners, regardless of the Silver Tsunami or any other reason, should have a succession plan in place. Without an adequate plan or with no plan at all, business owners face significant risks if they are unable to work. The owner should have the structure and tools in place for running the business in their absence and for when they’re ready to retire.
A business succession plan
A business succession plan is a blueprint for the future of your business. It involves who will take over ownership or run the business after you retire, if you become disabled, or when you die.
A succession plan may include the business’s valuation, formal operating procedures, future leadership structure, and more. The first step for many people in developing a succession plan is determining who will lead the business in the future. Business owners may decide to sell to a co-owner, pass the business down to a family member, or sell the business to an employee or outside party.
Every business needs a succession plan to guarantee that operations continue and customers don’t experience an interruption in service. A well-crafted succession plan benefits everyone, including the current owner, the employees, and the successor.
When should I create a succession plan?
Business owners should create their succession plans immediately if they don’t have one in place. Having a plan that details how the business will transition, who will take over ownership and become responsible for daily operations, and how partners and heirs will be compensated will help reduce the stressors created by the owner’s departure.
Help is available
The business and estate planning attorneys at O’Reilly Rancilio are available to answer your questions regarding business succession planning. For more information, please call 586-726-1000 or visit our website.