What’s Your Plan When Plans Change?

“The best-laid schemes of mice and men gang aft agley.” -Robert Burns  

What should you do if a plan you made isn’t working? Let’s look at how exit planning can position business owners to successfully adjust to changing conditions.  

Adjusting over abandoning  

Over the past few years, many business owners have learned that even their best plans can quickly go awry. This can lead to a temptation to abandon planning. However, there could be a better way.  

A major benefit of exit planning lies within its flexibility. This flexibility derives from a strict adherence to achieving an important goal: financial security for the business owner. This goal is the foundation on which you’ll pursue your other goals, such as when you leave your business, to whom you sell your business, and what you’d like to pursue after you no longer own the business. To successfully reach financial security, the exit planning process must be flexible.  

While achieving financial security is complex, the fact that every planning element moves toward achieving this goal regardless of the circumstances injects simplicity and focus into the planning process. This can make it less devastating when something doesn’t go precisely as planned, because there are multiple ways for business owners to achieve financial security, rather than just one.  

Diversifying strategies  

Almost every financial advisor and risk management expert will tell you that diversifying is a cornerstone of success. In exit planning, your advisor team will likely consist of a diverse array of professionals (e.g., lawyers, financial planners, CPAs/CAs) whose expertise can offer various strategies for success, along with backup plans.  

For example, you may begin the exit planning process by pursuing a third-party sale as the quickest means by which to achieve financial security. However, you may discover that the quickest way to achieve financial security doesn’t align with your other goals, such as when a third-party buyer intends to shut down local operations and put employees you care about out of work.  

The exit planning process should help you craft backup plans that align values-based goals with your financial security goal, better positioning you to exit on your terms.  

The diversity of your advisor team’s expertise could help you see a fuller picture of what you seek from your planning and how your plan can adjust to fit new wants and needs. Even when things don’t go exactly as planned, you can still move forward without having to start over.  

Planning that’s dynamic  

Like your business itself, exit planning is rarely static. The plan can evolve with your wants, needs, and desires, while still offering guardrails that prevent the plan from becoming scattershot or based too heavily on fads or fleeting emotions.  

That’s why exit planning includes short-term goals like determining a business’ current value, as well as longer-term goals such as establishing next-level management teams and building business value. These goals often work with each other and affect each other fluidly.   

We strive to help business owners identify and prioritize their objectives with respect to their businesses, their employees, and their families. If you have questions on this topic, we can help with more information or a referral to another experienced professional. Please feel free to contact us at your convenience.  

Imagine a world where your financial advisor, attorney, accountant, insurance specialist, and property/casualty advisor all worked together, like a board of directors on your behalf. This is the type of Collaborative Advisory Team approach we take in our practice. For many driven entrepreneurs, executives, and high-net-worth individuals, a Collaborative Advisory Team of professionals is the most effective and efficient way to achieve your optimal financial world. At Moneta, we’re reinventing the way you experience wealth management.

The information contained in this article is general in nature and is not legal, tax or financial advice. For information regarding your particular situation, contact an attorney or a tax or financial professional. The information in this newsletter is provided with the understanding that it does not render legal, accounting, tax or financial advice. In specific cases, clients should consult their legal, accounting, tax or financial professional. This article is not intended to give advice or to represent our firm as being qualified to give advice in all areas of professional services. Exit Planning is a discipline that typically requires the collaboration of multiple professional advisors. To the extent that our firm does not have the expertise required on a particular matter, we will always work closely with you to help you gain access to the resources and professional advice that you need. 

This is an opt-in newsletter published by Business Enterprise Institute, Inc., and presented to you by our firm.  We appreciate your interest. 

Any examples provided are hypothetical and for illustrative purposes only. Examples include fictitious names and do not represent any particular person or entity. 

© 2024 Advisory services offered by Moneta Group Investment Advisors, LLC, 100 South Brentwood Blvd., St. Louis, MO 63105 (“MGIA”), an investment adviser registered with the Securities and Exchange Commission (“SEC”). MGIA is a wholly owned subsidiary of Moneta Group, LLC. Registration as an investment advisor does not imply a certain level of skill or training. The information contained herein is for informational purposes only, is not intended to be comprehensive or exclusive, and is based on materials deemed reliable, but the accuracy of which has not been verified. Examples contained herein are for illustrative purposes only based on generic assumptions. Given the dynamic nature of the subject matter and the environment in which this communication was written, the information contained herein is subject to change. This is not an offer to sell or buy securities, nor does it represent any specific recommendation. You should consult with an appropriately credentialed professional before making any financial, investment, tax, or legal decision. Past performance is not indicative of future returns. You cannot invest directly in an index. All investments are subject to a risk of loss. Diversification and strategic asset allocation do not assure profit or protect against loss in declining markets. These materials do not take into consideration your personal circumstances, financial or otherwise. Trademarks and copyrights of materials linked herein are the property of their respective owners. 

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