SUCCESSION PLANNING

The Entrepreneurs Personal Financial Plan

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hen entrepreneurs consider their personal finances, it is critical they understand that the greatest intergenerational transfer of wealth in history will occur in the United States over the next decade. An estimated $10 trillion is expected to change hands, much of this resting in the hands of the nation's entrepreneurs, who must decide the fate of their companies when they are ready for transition. Many entrepreneurs who have family-owned or closely held businesses say their most difficult challenges are deciding who will succeed the current generation and how to preserve and build the company's value by providing for a smooth transition of ownership and management to the next generation. It is an understatement to say that estate and succession planning decisions involve complex questions of law, tax, and business planning. Such planning involves decisions about the types of property to own, the form of ownership and, for small business owners, the organization and operation of the business as well as the steps for passing that business on to the next generation. For the entrepreneurs, the only way to find the best plan is to work closely with the lawyer and other specialisb such as tax accountants, appraisJuly 2005 CPA W e a l t h P r o v i d e r ' 23

SUCCESSION PLANNING ers, life insuratice agents, bank trust officers, and financial planners, all of whom can provide other important sources of information that should be considered in the pianning process. However, the client must make the final decision about the organization and disposition of its business. For the CPA/financial planner, it is essential that the client be well informed about the choices available in order to make the wisest decision. • Making accommodations, if necessary, for intra-family feuds and normal family