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Corner Office: Running a Family Business? Plan Ahead

by Carl and Mark Uehling

Family Businesses are special in that they are often motivated by more than just financial goals. When your family’s name is associated with a brand, you share ownership and responsibility and work to achieve the same mission. Furthermore, the business often represents a lifetime—or more—of hard work, dedication and sacrifice that goes into being successful over the long-haul.

At Uehling Wealth Management, we believe that strategic planning is the key to growing a successful business and ensuring its legacy. From operational strategy to growth to financials, developing a solid game plan to protect your business and ensure success—even after you retire—is paramount. Let’s take a look at some of the necessary areas of planning for family businesses.

Family Succession and Business Continuation
According to Forbes, less than one-third of family businesses outlast the transition from first to second generation ownership, and another 50 percent fall victim to the second to third generation transition. In some cases, there are several family members in leadership positions, all of whom wish to be the next in charge. However, it’s critical to carefully and honestly evaluate each individual’s strengths within the company. Not everyone has the skills necessary—or the drive—to run a company. To ensure a successful transfer of ownership between generations, it’s crucial that each family member understand and accept their role in the business.

On the other hand, sometimes there are no family members interested in running the business or the business is co-owned by unrelated individuals. In this instance, it may be necessary to recruit and hire new talent to take on a leadership position or sell the business altogether. There are many ways to structure the sale of a business, and strategic exit planning takes time—often several years—so don’t wait until you’re ready to retire.

Estate Planning
There are a number of strategies to help transfer wealth upon the death of a business owner, but it’s crucial to identify the most appropriate vehicle for your business. We recommend working with a team of trusted professionals including a certified public accountant, an estate attorney and a financial advisor with experience with business owners. These individuals can help determine any federal estate and/or state inheritance taxes that may be incurred and evaluate strategies to reduce the ultimate size of the owner’s estate for cost savings.

Retirement Planning
The Financial Planning Association/CNBC Business Owner Succession Planning Survey found that 78 percent of small business owners plan to fund their retirement with proceeds from selling their business. Before transferring ownership of the business, we recommend working with a consultant to ensure that retirement planning strategies have been optimized.

While many small business owners may be tempted to sell to an unrelated individual for convenience, it’s important to note the benefits of the family business model when it is run well. Many family-run businesses benefit from that added level of trust and dedication—and many clients and customers see that value as well. Not only can we ensure our clients continuity of services for many years to come—as the first generation of our team retires, we can rest assured our family will continue to deliver the elite financial planning our clients have come to expect.

Carl and Mark Uehling are Financial Advisors with UBS Financial Services Inc., a subsidiary of UBS AG. Member FINRA/SIPC in Newtown, P.A. and Mount Laurel, N.J. For information, including the different laws and contracts that govern, visit

Published (and copyrighted) in South Jersey Biz, Volume 7, Issue 4 (April, 2017).
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