Planning for a Business Continuation or an Exit

Planning for a Business Continuation or an Exit

March 22, 2022

Whether planning for business continuation or an exit, the time to plan is well before you need the plan. You’ve spent many years building your business from the ground up, working through the highs and lows of entrepreneurship. Now, as you’re nearing retirement age, it’s time to think about what will happen to your business when you’re no longer working.

Evaluate Your Financial Situation

The most important thing to do when facing an exit or retirement—even a potentially early one—is to look at your financial situation. First, review the non-retirement funds you have available. Especially if you're retiring early, you may need to depend on your liquid assets and non-retirement savings accounts to get by until age 65.

How does your financial situation compare to where you want to be at retirement? Do you have gaps you need to fill? Will you have access to your retirement savings accounts right away or will you need to supplement your income in other ways? You can consider claiming Social Security earlier than planned, but keep in mind that your payments will be larger if you're able to delay.

Not only should you consider where you are in terms of savings goals, but also in terms of expenses. Is there debt you still need to pay off? If so, you may consider consolidating or refinancing that debt to ease the financial burden. Do you have a plan for your health needs? If you're younger than 65 you won't be eligible for Medicare, so it's important to research other health plans available to you, especially if your early exit is because of a medical issue.

Once you've taken stock of your financial health, you can make informed decisions about what's next for your exit from your business.

Plan Your Exit

Depending on your age and the size of your company, you may already have an exit plan in place. In that case, take a look at your plan to figure out if it still works for your situation. If you don't have an exit plan, now is the time to set one.

There are a few options for exiting your business, including:

  • Liquidating the business
  • Selling the business to someone you know
  • Selling the business to another business
  • Selling the business in the open market

It's essential to consider the state of your business before planning your exit strategy. Each strategy has its pros and cons. Liquidating your business can be the quickest way to exit, especially if you're dealing with financial strain, but it's not always the most profitable plan. Alternatively, you may consider selling your business to a family member or close friend who knows the business well for an easy transition—but be aware that selling to someone you know can be complex and has the potential to put a strain on your relationship.

Consult a Trusted Financial Advisor at Liberty Wealth Advisors®

Above all, consulting a financial professional is the best way to handle an exit, a continuation, or retirement from your small business. At Liberty Wealth Advisors®, we have extensive experience in business exit strategies. We understand that this process is often emotional – it's not just a transaction, it's a continuation and preservation of one's legacy. It can be time consuming and complex, with numerous tax implications, and an emotional component. We'll help you formulate a comprehensive plan that inspires you to feel confident about the future of your business and its legacy. We can assist with:

  • Evaluating and discussing alternatives for business transition or succession planning strategies
  • Discussing tax considerations with you and your tax advisor
  • Evaluating current business insurance and providing alternatives
  • Providing referrals to business valuation specialists
  • Mergers & Acquisitions (M&A) consulting including assistance with buyouts, growth equity, and venture capital
  • Executive recruitment & retention
  • Outsourced Chief Financial Officer (CFO) services
  • Corporate governance matters
  • Contract negotiation
  • Litigation strategy & support
  • Regulatory compliance support
  • Business IT & cybersecurity support
  • International operations/expatriate consulting
  • Sales & marketing support

At Liberty Wealth Advisors®, we help give you peace of mind by doing the daily work necessary to help ensure that your financial future is secure. To learn more and to get started on a comprehensive succession plan to achieve your financial goals, email us at or call 800-448-3550.

This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented, nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets.