GUEST COLUMN: Prepare for the future

While you run an active business, your exit strategy may be the last thing on your mind.

While you run an active business, your exit strategy may be the last thing on your mind. But consider your strategy in advance to help put you on a path to a smooth transition into a well-funded retirement.

Financial plan – A financial plan is a critical component of a business succession plan and will determine if you have adequate resources to support your retirement lifestyle and highlight which, if any, additional retirement saving strategies – such as an individual pension plan – are required.

Estate freeze – An estate freeze using a family trust is a common business succession and income-splitting strategy that transfers some or all of the future growth of the business to the next generation, helping to minimize and defer tax. Ensure the estate freeze is flexible enough so you can possibly reverse it if necessary.

Shareholder’s agreement – A well-drafted shareholder’s agreement provides a framework for the smooth operation of a business and addresses business ownership issues when certain triggering events occur, such as death, disability, retirement or marriage breakdown.

Insurance – Appropriate disability and life insurance can help ensure that the business continues and your family is able to maintain its lifestyle in the event of disability or premature death. Insurance may also be a low-cost solution for funding taxes at death and funding buy/sell agreements.

Kirbey Lockart is an investment advisor with RBC Dominion Securities. This article is provided for information purposes only. Please consult with a professional advisor before implementing a strategy.

 

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A windstorm Wednesday, Jan. 13, 2021, hit Lake Country hard closing Hare Road while crews respond to a broken water main. (District of Lake Country - Facebook)
TAYLOR: Discovering the essentials of life

Calendar columnist Jim Taylor reflects on last week’s windstorm

A Vernon man's faith in humanity has been restored since his lost wallet was returned, credit cards, cash and all, to the RCMP station. (Contributed)
Good Samaritan turns in cash-filled wallet to Vernon Mounties

Owner’s faith in humanity restored following a tough few weeks

Vernon Fire Rescue Services responded to a single-vehicle rollover Wednesday, Jan. 20, 2021, after a vehicle came into contact with a pedestrian light pole at Kalamalka Lake Road and 14th Avenue. (Brendan Shykora - Morning Star)
Minor injuries in rollover after vehicle hits Vernon crosswalk pole

The vehicle flipped onto its side, closing Kalamalka Lake Road

Vernon's Noric House long-term care facility is dealing with an influenza outbreak amid the COVID-19 pandemic. (File photo)
Two more deaths at Vernon care home

Noric House case numbers remain steady, but death toll rises

The BC SPCA is adapting its fundraising after cancelling events due to COVID-19 restrictions. (Twila Amato - Black Press Media)
BC SPCA gets creative with fundraising as pandemic continues

The non-profit’s in-person fundraising events all had to be cancelled due to COVID-19 restrictions

Vancouver Canucks’ Travis Hamonic grabs Montreal Canadiens’ Josh Anderson by the face during first period NHL action in Vancouver, Wednesday, Jan. 20, 2021. THE CANADIAN PRESS/Jonathan Hayward
Horvat scores winner as Canucks dump Habs 6-5 in shootout thriller

Vancouver and Montreal clash again Thursday night

Interior Health has declared the Cariboo Chilcotin a community cluster. (Angie Mindus photo)
Interior Health declares Cariboo Chilcotin region a COVID-19 cluster, 215 cases since Jan. 1

Most cases are related to transmission at social events and gatherings in Williams Lake

Penticton city council heard from Dhorea Ramanula, of Paid Employment for People with Lived Experiences Tuesday, Jan. 19. Ramanula’s organization has operated public washrooms in Kelowna staffed by community support workers since April, she says Penticton could benefit from a similar facility. (Michael Rodriguez - Kelowna Capital News)
Penticton interested in new public washroom concept to combat vandalism

Public washrooms with on-site support staff have been operating in Kelowna since April

Canada Post had remove a lot of letter boxes around Penticton after they were vandalized. This letter box at the United Church on Main St. remains unscathed. (Monique Tamminga Western News)
Street mailbox vandals strike Penticton drop boxes

Canada Post had to remove a bunch of the vandalized units

Esa Carriere, 23, was the victim of a 2018 Canada Day homicide. (File)
Youth sentenced in Kelowna Canada Day killing

Young woman pleaded guilty to lesser assault charge, sentenced to 15-month intensive support and supervision program

A rendering of UBC’s planned downtown Kelowna campus. (Contributed)
Kelowna’s new downtown campus to help alleviate UBCO’s space crunch

The sizable development is anticipated to be completed by the fall 2024 semester

Eighteen-year-old Aidan Webber died in a marine accident in 2019. He was a Canadian Junior BMX champion from Nanaimo. (Submitted)
Inadequate safety training a factor in teen BMX star’s workplace death in 2019

Aidan Webber was crushed by a barge at a fish farm near Port Hardy

Most Read