Potential benefits of passing your business on to family members
You’ve run a successful company for several years now. Recently, you’ve been contemplating what will happen to it when you are no longer around. You’ve decided that you want to keep the business in the family, passing vital knowledge as well as your assets on to your loved ones.
This is something that many business owners opt to do through their estate plan. Here are some of the potential benefits of passing your business on to family members.
If there’s one thing you know about your family members, they are trustworthy and reliable. The success of your business has also largely centered around the good reputation of your family name. Keeping the company within the family allows you to retain some stability and continue to use the family name that has allowed you to get so far already. Staff may also feel more secure in the knowledge that outsiders will not be coming in to shake things up.
Scouting for an outside hire to take over the company in itself can be expensive, and this is before you have negotiated their benefits package. Your family members have been around the business for many years, and you already know that they have the required skills to take on the task. Passing the company on to family members can make for a much smoother transition of ownership.
For your succession plan to work, you may need to utilize trusts, a will and other legal tools. The drafting of these documents must be above board for them to carry out their intended functions. Seeking legal guidance can help to ensure that everything goes according to plan.