By Bryan Trugman, CFP

Retirement planning is inherently more complex when you own a business. It’s one of the many trade-offs that come with being your own boss. When you work for someone else as a full-time employee, you don’t have to consider nearly as many variables, because an employee doesn’t have as many options or degrees of flexibility as a business owner does. I always encourage my business owner clients to create separate financial plans for their personal households and their businesses. You also need to maintain separate contingency plans for both entities. Exit planning is the process where everything converges.

You Can’t Start Early Enough

How you plan to retire, even 15 or 20 years from today, will shape the strategic decisions you need to consider now. Where are you going to live when you retire? How are you planning to fill the 40-hour gap? How much personal income will you need? Unlike an employee, you are not restricted to a predetermined set of retirement plan options dictated by an employer. The attractiveness of your options will largely depend on how much shareholder equity you build into your business. Does your company have intellectual property, a well-established brand, or other proprietary assets that will continue to create value for a new owner? Ask yourself now: what would your company be worth today, if you were no longer around to run things?

Start Transitioning Now

Your exit from the business may happen sooner than you anticipated. Business owners are often forced to retire early because of health problems, injuries, and personal family situations. Unlike an employee, you can decide when and how to begin transitioning out of your role. Retirement aside, I assume you want to grow your business. Your ability to develop leaders and delegate responsibility is a key component of your ability to take on bigger opportunities as a company. Here’s a way to reframe the situation: the best time to start transitioning out of your job is today! Put another way, as an entrepreneur, you are always working yourself out of a job, because you are always moving into a new job. Who would take over your current responsibilities if you suddenly became unable to work? Would that person be well-equipped?

Build Your Team

Exit planning is a team effort and you will need to enlist the help of professionals to answer many unfamiliar questions. Do you have an estate plan? If so, when was the last time you reviewed the plan? Are you certain that you are funding your retirement as fully as you could be? Are you using the best tax-advantaged vehicle available to you as a business owner, given the size, structure, and cash flow of your company? Are you going to run into any capital gains tax issues down the road that you could prevent or mitigate? Are you utilizing the right mix of insurance policies in the right way? Most business owners have better options than they realize, and they commonly regret waiting too long to evaluate their choices. I sometimes think of myself as the “quarterback” on the team, and part of my job is recognizing which expert to call in at the right times. Successful business owners establish the habit of asking, “Who can help me?” instead of asking, “What should I do?”

We Are Here to Help

As the old saying goes, “Begin with the end in mind.” Your exit plan will shape the decisions you make and the options available to you for years to come. If the idea sounds overwhelming, that’s understandable, and that’s why we’re here. My role is to free up your time and your mental energy. I can also help you think more clearly about what you need to decide now, versus the decisions that can wait until next year. If you are ready to start mapping out your retirement, reach out to me via email at or give me a call at (516) 762-7603 to set up a consultation.

About Bryan

Bryan Trugman is managing partner, co-founder, and a CERTIFIED FINANCIAL PLANNER™ practitioner at Attitude Financial Advisors. With more than 13 years of experience, Bryan specializes in addressing the financial needs of new parents as they seek to realign their finances, assisting divorced individuals as they navigate an unforeseen fork in the road, and strategizing with those seeking to accrue a dependable retirement nest egg. Bryan is known for being a good listener and building strong relationships with his clients so he can help them develop a customized financial plan based on what’s important to them. He is passionate about helping his clients experience financial confidence so they can worry less and play more. Bryan has a bachelor’s degree in industrial and systems engineering with a minor in mathematics from State University of New York at Binghamton. He has served on the board of the Financial Planning Association and continues to be actively involved in the national organization. He is also a member of the Plainview-Old Bethpage Chamber of Commerce and has served as its vice president and as a board member. When he’s not working, you can find Bryan on the ballroom dance floor or engaged in a fast-paced game of doubles on the tennis court. To learn more about Bryan, connect with him on LinkedIn. Or, watch his latest webinar on: How Much Is Enough? A Surprisingly Simple Way to Calculate Your Retirement Savings Needs.

Copyright © 2024
Financial Advisors in Woodbury, NY