WITH YOUR PLANNING
What does it mean to be deliberate with your planning? What if you do not plan? Well, if you fail to plan, then you plan to fail. You have heard it time and time again, and it holds true for some of the most important things we do in our lives, both with our businesses and with our families. We plan every day, whether we realize it or not. We plan what we are going to do in the morning. We usually plan it before we go to bed, at least most of us do. We plan what we’re going to do that evening when we get home. We plan what we’re going to do throughout the workday. We make all these plans for each day. Unfortunately, most of us do not plan for the most important things in our lives, those being our families and our businesses. If you do not plan properly, you’re not going to be successful. Worse yet, you leave life to chance.
All great businesses develop a plan and execute their plan. Large companies like Tesla, GE, Toyota, you name the large company, they have a plan. Small business owners should have a plan too. For example, what is the plan for your business? If you are just starting up, you will need to have some sort of a plan in place, or, at the very least, you need to have some idea of how your daily business is conducted. It’s necessary! You must plan it out. How will your business get customers and grow? Are there going to be benchmarks along the way that will identify the direction in which you plan to grow? Have you protected your business to manage the growth? What type of agreements do you need to put into place to protect your business if a dispute occurs? You need to ask questions like this to help you with planning. If you are not thinking about questions like this as a business owner, then you are not going to be as successful as you could be, bottom line.
Other questions business owners need to consider are, what will happen when you no longer want to run the business? You may reach a point when you say “I’m done. I can’t do this anymore.” Are there family members that are going to be a part of your business? Are you going to pass it down to them? What’s your succession plan look like? This is something many business forget to implement. Business owners are much better at having an initial plan that guides them through the initial phases of the business cycle, but they often fail to develop a succession plan. What is the exit plan for your business? Are you going to step back and let one of your family members take over? Are you going to let an employee take over? Are they going to buy it from you? What’s that going to look like? How is it going to be funded? The answers to these questions need to be put into a plan.
Likewise, you also need a plan for your family. Estate Planning is incredibly important to address your family’s needs. I kid around a lot with people and tell them that if you don’t have a plan, Virginia has one for you. I am referring to the laws of intestacy, which are laws in Virginia (and each state) that address what happens if you do not have an estate plan or even a simple will in place when you pass away. They are in state laws for people who fail to plan. It is a fact that over 40% of Americans do not have a simple will in place. Even more people than that do not have adequate estate plans in place. Many individuals have a will in place that was drafted ten, fifteen or more years ago and they are not up to date. Executors (those people you put in charge of your estate after you die) may have passed away, children may be older, and spouses may have divorced. All these things could affect your estate and the administration of your estate after you pass away.
Some of the topics you want to think about when developing an estate plan for your family are, how will you title your assets and where will they go when you die? Will your assets go through probate (the court-ordered process of settling someone’s estate…yes, the court gets involved)? How will you provide for your family if you are no longer around? What is going to happen with my children? If you have a business, what happens to your business and the assets of your business when you pass away? Your estate plan should ideally be planned in addition to any business planning, which becomes part of your succession plan.
Again, if you fail to plan, there are intestacy laws in state code for people who have not made plans. Unfortunately, those intestacy laws may not be in line with how you want your estate distributed and who you want to control your estate. The intestacy laws are rigid and may give your assets to someone that you may not want to receive your assets. The laws may allow someone to qualify to administer and settle your estate that you may not want to handle your estate. State law will also become heavily involved with who will be the guardian of your children should something happen to you and your spouse at the same time. This has huge consequences when you do not have a plan in place for your family. Who is going to get your children? If you do not have a plan in place to address this, your children may go to someone that you never planned on having as their guardian. I won’t get into all the different scenarios, but it happens. This issue ends up going in front of a judge and the courts decide what happens and what they deem is in the best interest of the child. If you have not thought through any of this, then you are doing your family and yourself a huge disservice.
It is so important to develop and implement solid plans to address your business and family needs. If you fail to plan, then you plan to fail. If I can help you, please contact me at 540-692-9790 or click the link below to schedule a free 1 hour consultation.