As a small business owner, one of your greatest assets is your small business, so you need to think about how you can monetize your business without being present. This means you need to plan out your retirement in detail.
Plan for your Retirement
First, you need to decide if you want to sell the business, hand it down to a family member or an employee, if you want to close the business or sell out your partnership. Once you’ve made that decision you can prepare for retirement.
Develop an Exit Strategy
If you plan to leave the business one day, it will have to operate without you. Think about who besides you can run the business. If you have a business partner, is he or she interested in taking over the business? If you decide to sell your business, specify if you want to keep a partial stake in the company. Plan your exit strategy.
Writing out policies and procedures is essential in this process. Employees can use a procedures manual as a point of reference and it gives them more confidence to operate the business without you. If you decide to sell the business to an employee or partner, you should arrange a buy-sell agreement, a contract that prepares the sale of your business interest.
Keep your Numbers in Mind
Make sure you calculate how much you will need after you retire. Get a sense of what your living expenses might be once you stop working. This will give you a better idea of how you need to prepare your finances.
However you decide to leave your business, it requires planning. Small business owner should not expect to simply be able to stop operating the business one day and be able to sell it immediately. It takes time.