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Work with experienced attorney to set up smart succession plan

Succession planning is something every business owner has to thing about at some point to one extent or another. As we mentioned in a recent post, careful thought and working closely with trusted individuals is important succession planning, as is getting started early. Particularly important is the development of an ongoing process for succession management so that the process is well-established by the time one retires.

Succession planning is going to be different for every company, and this depends not only on the individuals within the company but also the industry itself. For instance, owners of RIA firms have to deal with the issue of how to approach succession planning while abiding by their legal duty as fiduciaries to their clients.

In some cases, RIA firms can be faced with the question of whether to choose a succession plan which is best for the company financially or one which is really in the best interest of its clients. Business owners may have to decide between a plan which provides optimal security for their families versus one which is really best for their clients. And often, there are ways to ensure one honors fiduciary duties while also being mindful of the interests of the firm and one’s family.

Needless to say, it is important for business owners to work with experienced professionals in setting up a succession plan, both from the financial and the legal aspects. Doing so will ensure the business is left in good hands, honors its commitment to clients, and benefits one’s family.

Source: Financial-planning.com, “Is Your Succession Plan a Fiduciary Breach?,” Matthew Cooper, August 14, 2014. 

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