All in the Family: Tips to Pass Wealth to Children Who are Not Part of the Family Business
The following is an excerpt from Ice Miller's Business Transition Strategies to Preserve Wealth Guide, which provides insights on a variety of topics to help ensure a smooth business transition.
You are finally ready to think about passing the baton to the next generation. One child shares your passion for growing the business and responding to the changing marketplace. She has experienced positions both outside and inside the company, working her way up the ranks to understand the various facets of your industry. She seems to be a natural fit for the next generation of leadership and has indicated a long-term commitment to carrying forward the family enterprise. But you have more than one child to include in your estate plan, and you have reservations about “favoring” one over the others.
As business owners consider succession planning and future retirement, this scenario is a common one. Estate and business succession planning advisers have a number of tools to assist business owners with considering what is the right legacy to leave to various family members, whether they are inside or outside the family entity.
First, release yourself from the notion that each child must receive an “equal” share of your estate. If the end game is to pass the business to less than all of your children, then equal distribution simply is not achievable. However, equitable distribution is possible. But it takes time and proper planning.
To learn more, download the Business Transition Strategies to Preserve Wealth Guide or contact Kristine Bouaichi or Natalie Perry.