For the majority of business owners legacy is passing the business to the next generation, often comprised of succession planning for your business, and ensuring the operation remains productive past your lifetime. But let’s face it, the traditional family model, mother, father, and four kids; two boys and two girls in a white house with a picket fence is no longer the norm. We live longer, don’t like big commitments, and due to all the resources available, we have the luxury of dreaming like there is no tomorrow. This is why we as women must adjust on how to leave a legacy when there may not be a family, a solid business or steady industry growth. The challenge is defining legacy not by what it is but by what it is not.
Legacy is not leaving your family with a big bill to take care of you economically past your hard-working creative years of successfully growing your business.
The majority of business owners don’t have a retirement plan (35% according to a study) and yet are able to report large gains in their lifetime. How is this possible? As human beings, we are not coded to instinctively think long term. But please hear me loud and clear, I have seen way too many successful million dollar business owners regret this in their older years. Do yourself a favor and ensure you are taking full advantage of your Individual Retirement Account (IRA), and other Business Owner Retirement Plans, and investment policy statement. Also, hire a good financial planner to help you make smart decisions for your profile – not one size fits all here.
Legacy is not leaving your business to be inherited with no instructions in the same document that lists your house, car, furniture, jewelry and investment accounts.
It should be established in a legal structure according to your forecasted growth, industry and services/products offered. In addition, a full succession plan should always have a successor in mind. You should train this person to fill in your shoes at any point in your life. Another idea is to sell it to existing employees or management, or leave a plan to sell it to an outside party. The answer can be determined by considering the type of business, how quickly you need the cash, the maturity of the business, and your team. Communication, transparency and ensuring your wishes align with key legal documents will ensure a smooth transition process.
Legacy is not leaving your business high and dry or subject to volatility in the industry.
All responsible business owners must have key insurance policies such as life insurance. This insurance should cover sudden death, disability, protection of assets, and include supplemental insurance as necessary. In a nutshell, the policies should ensure that you will not put your business at risk in case of an unforeseeable catastrophe. Also, your business must have an innovation budget and a strategic plan for the next 3 to 5 years. This will ensure that your business will survive past a difficult season or an economically or politically volatile period. And lastly, you should always have a plan to give back to the community in the area in which your passion is reflected. For example, my passion is financial planning and my foundation offers free financial planning workshops.
Your legacy as a woman is to inspire future women business owners by serving as a mentor. In this role, you can share your expertise so they can reach their goals faster than you did. When you serve and mean well, there’s no need to view everyone as a competitor. There is no better legacy than seeing your advice, recommendations, and suggestions, planted in someone else’s life. Because of you, they enjoy greater prosperity, a higher quality of life and make money a positive force in the world. This last one, my friends, is my legacy.