Small Business Financial Planning

Small Business Financial Planning

The goal of business planning is to extend success and profitability into the future and to protect your hard-earned equity. Business planning integrates your business and personal objective and establishes the link between where you are and where you want to finish.

Types of Business Insurance Concerns

• Buy-Sell Plan
• Compensation Programs
• Deferred Compensation
• Key Employees
• Split Dollar

Business Planning Checklist

• Formation Stage - when yours is a new business
• Accumulation Stage - for a business that is established and growing
• Mature Stage - when you approach retirement

Formation Stage:
Covering the basics for a new business

• Do you have a written will?
• Have you reviewed your present will to be sure it is up to date?
• Have you considered key-person life insurance on yourself to protect your family and cover debts?
• Have you protected yourself against disability?
• Do you provide group life, disability and medical plans for your employees?
• Have you completed an estate analysis to compare your assets with your objectives?
• Have you considered a stock redemption agreement or a buy/sell agreement with partners or stockholders?
• Have you considered tax-sheltering income in an individual retirement account?

Accumulation Stage:
When your business is established and growing

• Have you reviewed your present will and business arrangements?
• Have you completed an estate analysis to review your tax situation?
• Have you considered using equivalent exemptions trust agreements to save estate taxes?
• Have you considered increasing group insurance and key-employee insurance?
• Have you reviewed the income and estate tax advantages of sheltering moreæ income in a qualified retirement plan (pension, profit-sharing or 401(k)?
• Have you considered increasing fringe benefits for employees?

Mature Stage:
When you approach retirement

• Have you reviewed wills and trusts with your accountant, attorney, bank trust officer and life insurance agent?
• Have you increased selective fringe benefits (salary continuation plans and splits dollar plans) for your most important employees?
• Have you considered deferring income through deferred compensation plans?
• Have you considered making charitable bequests to save income and estate taxes?
• Have you considered reorganizing your business to make transfer easier?
• Have you considered reorganization agreements?

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