Your Worst Nightmare and Most Dangerous Threat to Your Business
Though the unexpected death of one your business partners
would be dreadful, the real nightmare begins when you have to determine how the
business will survive after the loss.Another question that might have to be answered is how to compensate his
surviving heirs for his ownership in the business.Unless you want one or more his heirs to be
involved in your business operations, decision making, etc, it would be best to
make a contingency plan for the death of one of your partners now.
Not only should you plan for an unexpected death, you should
plan for the disability, termination, or retirement of a partner or co-owner. The
recommended way of creating a contingency plan is to fund a Buy/Sell Agreement in
a Cross Purchase Agreement using life insurance policies.This process is not complicated, and the
advantages are as follows:
·The surviving owners can use cash from the life
insurance policy instead of the business to buy out the surviving heirs.
·The life insurance policies can provide living
benefits to the business owners via the cash value that will accumulate during
the life of the insurance contract.
·After consulting an accountant, the business
owners may choose to pay their life insurance premiums via the business.
Though the process of setting up a Buy/Sell Agreement
involves consulting with an attorney, it is well worth the effort to insure the
survival of your business.Call me to
schedule a consultation to get started on your contingency plan. It's your money . . . until you give it away.
Business Shout Out!
If the secret to American wealth lies within the freedom to own assets with deeds, titles, and articles of incorporation, this may be a good time to start looking for a property to purchase. Here's a list of my preferred realtors. Tell them RHFG sent you:
Natalie McCulley, 817-480-7060
Kevin Young, 972-977-2044
Lazar Hearns, 469-471-8663
Lynell Jones, 214-563-1193
Elaine Cook, 972-672-5641
Sarah Zafarano, 469-569-3019
·Looking for a featured speaker for your group,
association, organization, small business, etc? I regularly present "the
10 Principles of Money Mastery" to organizations just like yours. Call or
email to make me your featured speaker!
Did you know?
60-70% of each one of your life insurance premium payments should/could go to your cash value accumulation? Don't know how much of your current premium payment is going to cash value? Call me. I'll check it for FREE.
In future issues, businesses that have entered into a Joint
Venture with RHFG will be members of the Business Advisory Council and will be
featured in every issue of “It’s Your Money!”Stay tuned.
And You Thought You Were the Only One Looking Forward to Your IRA/401(k)
If you thought you were the only one looking forward to the
benefits of your qualified retirement plan (IRA/401(k)), think again.As it turns out, Uncle Sam is also rubbing
his hands as you work tirelessly to build your nest egg.Your IRA, 401(k), TSA, 403(b), 457, pension
plan, and/or profit-sharing plan is creating an intended and predictable tax
result that Uncle Sam is anxiously anticipating when you decide to take your
distributions.And as your retirement
plan grows tax deferred so does the amount of taxes you will eventually
owe.By investing in a qualified
retirement plan, you have unknowingly decided to be taxed on the harvest of
your investment instead of the seed of your investment.Think about that for a couple of seconds.Does that seem like a good investment
Also, you and I have been led to believe that when we
retire, we will be in a lower tax bracket.At least three events may prove this to be unlikely.First, if you pay your mortgage off by the
time you retire, you will own your home, but you will no longer be able to
claim the mortgage interest tax deduction.Second, if you’re an empty nester, you will no longer be able to claim
your children as dependents on your tax return.Third and possibly the most troubling event is that with the deficit at
$16 trillion and rising, no one knows what the income tax rates will be when
you reach retirement age.Do you think
the income tax rates will decrease, remain constant, or increase to meet the
steadily increasing deficit?
Not to add insult to injury, but do you realize if you die
before you exhaust your IRA/401(k) funds, your beneficiaries will be taxed on
the transfer of funds?What if you could
accumulate your retirement savings tax
free and then use your retirement savings tax free and if you died before exhausting those funds, you could transfer
the remaining funds to your beneficiaries tax
free?You can.Call me to set an appointment to find out
how.It’s your money . . . until you
give it away.
Did I mention . . .
If you own commercial property, and you're upside down on the mortgage, a member of my Business Advisory Council can help you refinance and
have equity in your property again.
If you own a residential property that appraises for over $420,000, and you're upside down on your mortgage, you too could refinance and have equity in your property again. Call or email me to find out how.