Are all of your retirement eggs in your business basket? Probably, not the best idea.
Building wealth outside of your business could reduce the risk of relying on just one income source to fund your golden years.
Relying on your business for retirement
Your most valuable asset may be your business, so it’s natural to count on the money you’ll get when you sell it to fund your retirement. To achieve that goal, that dream, you’re probably doing all the things that build the value of a business such as:
- Installing and training a capable management team
- Developing a recognized brand
- Standardizing systems
- Relentlessly pursuing operating efficiencies
You deserve all due rewards and a big payday from your business.
Consider the ‘what ifs’
As terrible as it is to contemplate, it’s important to ponder a few chilling scenarios about when it comes time to sell your business.
- What if the sale of the business doesn’t fetch the amount of money you need to retire?
- What if it doesn’t sell when planned?
- What if the business doesn’t sell at all?
- What if the business fails before you even reach the point where you want to sell?
While none of these things may happen, you might decide that wealth diversification could help you (and your family) sleep better at night.
Building your investment portfolio
There are many options available to help build your investment portfolio, including:
- Registered Retirement Savings Plans (RRSPs)
- A Tax-Free Savings Account (TFSA)
- Real estate holdings
- Guaranteed Investment Certificates (GICs)
It’s worth investigating these and other options.
Speak with your advisors
As any changes to your plans may involve both personal and business assets, it’s best to speak with your team of advisors to gain the advantage of full-view input.
Contact your personal financial advisor, accountant, lawyer, and Scotiabank Small business advisor.
Before you take action on any of the information above, we recommend consulting with a qualified business advisor that understands your unique needs and situation for your specific business and/or personal plans.