The average UK business owner will have £600,000 net worth, so depending on what industry you operate in your company may be worth anything from £300,000 to £1.2 million. But that is all dependent upon finding a buyer, right? But, do have you got a ‘Plan B’ for your retirement?
What if you couldn’t find a buyer for your business and how would you go about selling it? Do you have a ‘Plan B’ if you don’t sell your business for what you would like?
Having a ‘Plan B’ for retirement
Most of us, company directors and business owners and I include myself in that, will usually have some sort of a plans to sell our business. These plans could range from increasing cash flow, to increasing profitability, to growing the size of the business. I believe that a big part of the success of business owners is that we are usually great a ‘Plan B’s’ or to put it another way, we are great at fixing problems. That’s why we are business owners in the first place. It sometimes surprises me when I hear how some of us ‘business owners’ are not paying quite the same level of attention to our retirement plans.
From our experience, when we meet new business owners for the very first time, we discover that their accumulated pension fund or funds amount to on average £80,000 to £120,000. Unfortunately, many of them have become disillusioned with their pensions, usually, because of lack of advice from an adviser or as is often the case, they have completely disappeared. Let’s face it, few people wake up each day and think, “I must get my retirement plans sorted out”. And even if you did, there are usually far more important things that need your attention at work.
Many business owners have ventured into the world of Buy to let, with varying degrees of success. However, with the current raft of legislation facing private landlords, is property investing still going to be effective. For many, it is going to lead to much higher tax bills than before.
I don’t know about you, but £80,000 to £120,000 in a pension fund is a fair amount of money, but it is not going to keep me in a luxurious retirement. In addition to that, I certainly don’t want to work forever.
In my opinion, getting our retirement plans in order is more important than ever. After all, there will be no Knight in shining armour coming along when you reach retirement age to save the day. It’s up to all of us to make appropriate plans.
Are you a business owner or self-employed? Behind the curve with your retirement plan? Got pensions that you don’t know what they are doing?
Now may be the time to start to consider where you are right now, where you want to get to and when. Working out what you need to do next could just be what you need to put on your ‘to do list’ for the coming year ahead.
If you would like to talk to about financial planning, please get in touch for a no-obligation meeting. Go to our website www.miadvice.co.uk and contact us via our “Get in touch” form on our home page or Contact Martin Dodd on 01902 742221.
Email us at firstname.lastname@example.org
It is advisable to take advice from a professional financial adviser when making major financial planning decisions.
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This article has been prepared in good faith and based on Midlands Investment Agency’s understanding of the law and interpretation thereof at the time of creation. The contents should not be regarded as specific advice and we always recommend that specific advice is sort from a qualified professional. No responsibility can be accepted by Martin Dodd or Midlands Investment Agency Ltd., for any loss that may occur by a person acting or refraining from acting on the basis of this article.