couple evaluating offer to sell a business

When You Want to Sell a Business and Need a New Advisor

It started as a sneaking suspicion. Then it became a wistful conversation with your spouse on a long, tropical vacation. Now, you think it might be time to get serious about it. It’s time to sell your business. Who do you call first?  A new financial advisor.

The Epiphany

“I have four advisors but I need someone who does what you do.”

We have heard a variation of this quote repeatedly from business owners when they first meet with our team of Certified Financial PlannersTM.  They sit across the table from us and admit how they feel uncertain, confused, even intimidated by the thought of planning their financial future. Then they spread out statements from brokers, banks, and 401(k) plans with each statement listing a financial professional on the first page. All of these relationships, accounts, funds, and policies add to the confusion. The epiphany that has brought them to our office is this:

“If there is no one coordinating all of these moving parts, then then the one responsible for everything is…Me.” 

The decision to sell a business is about lightening the load, not swapping it for a new one. Especially when there are so many questions to be answered.

The Lingering Questions

The accounts, attorneys, and business consultants help to bring the business to the threshold of a life-changing transaction. What about the decisions to be made on the other side? This is the blind spot for most business owners because what happens to your personal finances once you sell a business is like nothing you have experienced before. When you think about cash from the sale, your mind races to questions like:

  • How much risk can I take with the proceeds of my sale?
  • How do I pay myself in retirement?
  • What are the rules around IRAs, Social Security, taxes, etc.?

Why change advisors, then? Your advisors may be generalists or the wrong type of specialists. The generalists are the brokers who wear all the hats; A Jack-of-all-Trades, but likely a master of none.  Your advisors may have a specialized role that is not helpful in this new, complex situation. Some common advisor specialties include:

  • The Insurance Salesperson
  • The Stock Broker
  • The 401(k) Advisor

At this critical stage of life, you need someone whose specialty will guide you through the complex decisions that high net-worth families face when your focus shifts from business ownership to a fulfilling next stage of life. You want someone to meet you where they are, come alongside and guide you through the best version of the years ahead.

The New Advisor Relationship

If you are a business owner who is ready to plan for the financial future of your family, here is how you should go about finding the right advisory relationship:

  1. Clarify Your Expectations
    • What specific expertise should your advisor have?
    • What are the pressing questions you have about your transition to retirement?
    • What services from an advisor will help you to remain focused on living life to the fullest?
  2. Interview Your Advisor
    • Is the advisor a Fiduciary?
    • What are their credentials?
    • What is the profile of their ideal client relationship?
  3. Seek Simplicity
    • Your advisor should help consolidate, simplify, and clearly present your financial picture.
    • There should be easy to understand tools to monitor your progress.
    • Your advisor should coordinate between your other professional advisors to help you make informed decisions.

If you are a business owner with thoughts of selling and questions about your financial future, now is the time to start gaining clarity. If you don’t know the right questions to ask, we have a list of Questions for a Financial Advisor that can help you when you re-interview your current advisor or consult with a new one. Download this free resource here.

You get one chance to ‘stick the landing’ on your exit from your business, make sure you have the right advisor by your side.