Growing Your Net Worth: Creating a Strategy in Four Steps
Once a business is past the start-up phase & generating profits, there's significant opportunity to increase your net worth. Here are 4 important steps.
Many business owners forget that building a brand, making profits and creating a loyal customer base are just part of building net worth for a business’ founder. Once a business is past the start-up phase and regularly generating profits, founders have a significant opportunity to increase their net worth.
“Make sure you are preparing for the future,” says Lisette Galindo, Vice President, Private Banking at Cadence Bank. “For many business owners, their business is the most critical asset on their financial statement. While there’s no catch-all plan for everyone, depending upon your goals and what you see as the end game, we can create a plan that will allow you to achieve your desired objectives.”
- Make sure you have a business succession plan: There are a couple of important questions about the future you’ll want to consider. Are you planning on expanding your business with an ultimate sale in mind? Do you have heirs you’d like to take over the business when you step away? Are there key employees whom you’d like to have the opportunity to buy your business? Depending on how you see your end game, you’ll need a strategy in place to ensure your desired outcome.
- Create an exit plan: Ensure your business is ready for your exit regardless of your succession plan. Make sure your wishes are known and recorded. Set milestones and dates for achieving them. Don’t leave this important aspect of your business up to chance.
- Set aside funds for the time you step aside: Make a plan for how you are going to move funds out of the business to accommodate your end goal. Some business owners establish a family or corporate trust for this purpose—be sure and consult your tax provider to determine any tax ramifications that might be associated with your plan.
- Consult with a trusted wealth planner: A wealth advisor can help you determine the best plan of action to ensure you are financially preparing to meet your end game. Taking action now, before it’s time to exit your business, will allow you to put the right resources in place to ensure you meet your goals. The Wealth Advisors at Cadence Bank can help you determine the best way to manage your deposit and savings accounts, lines of credit, loans, etc. to position you and your business in the best possible financial position.
This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.