Planning for Retirement


Q. I am a baby boomer, and the retirement years are looming large. I have one to two years before I want to retire. Do you have any suggestions for an exit strategy?

A. Begin by finding out what your business is worth from a reliable source. Next, look at what you can do to improve the bottom line. This is not the time to purchase expensive equipment, but rather a time to cut any dead wood, do a rate increase, and trim your sails. You want your business to show proven profitable EBITDA figures for the past year. Call your attorney to set up any legal structures that might maximize profit and protect your assets. Also, give your attorney the name and number of a reliable broker who has your information and can proceed with the sale in case of your death. Finally, call any of your other trusted business and financial advisers for their guidance.

If your family is involved in the business, talk to your accountant to determine the best way to pass on the business. If you are going to sell it, mentally go through the sales process to see how the sale could affect you and your family’s tax position in order to maximize the sale proceeds. For example, if you are a C Corp, you will be double taxed, so this consideration should be taken into account when pricing your business. You will probably want to take a note back for consulting, as this will put more money in your pocket. Items like this will often increase the value of your business and should be considered before it goes on the market.

It is best to plan from a place of balance in your life where your business and personal matters are doing well. Emergencies such as poor health, financial issues, or family problems are not the time to make important decisions. Poor choices come from reactive decisions caused by stress, seriously undermining one’s retirement. Have a plan in place; then, if you do have an emergency you won’t be making desperate or questionable judgments.


Steve Michaels

About Steve Michaels

Mr. Michaels owned his own telephone answering service in Palo Alto, California and was the founder and publisher of the Connections Magazine. He has personally published over 200 TAS related articles including a monthly segment called "Mind Your Business" which was featured in Connections Magazine. He also e-mails a highly regarded newsletter called "TAS Tips" to over 1500 businesses. Steve has been a speaker for this industry and has worked for 4 major TAS/Voice mail companies including a manufacturing company, which he helped to take public.