Think HBR

You own your business but will you own your retirement?

Matt Kerr
Pitcher Partners Wealth Management
Most business owners go into business with the expectation of building value over time and then extracting that value when they exit. The trend appears to be that younger generation family members are not as interested in actively managing the business, meaning retirement/exit strategies are becoming increasingly limited for the aging population of business owners. Many business owners link their retirement plans to either maintaining ownership of the business to share in the profits or are relying on an adequate sale price for the business to fund their retirement.
A lot of owners consider their business is their superannuation, but like any investment portfolio, there needs to be adequate diversification to minimise risk. With the environment changing, it is becoming more important to consider wealth strategies during your working life. Business owners should be just as focussed on building their personal wealth, extracting value from the business along the way, as they are on growing their business.
In an ever changing world we sometimes forget the simple things that can make a huge difference in our lives. When it comes to building wealth the starting point is knowing what surplus is available and then what is the smartest thing to do with that surplus. There are many choices available, including clearing personal debts, increasing superannuation contributions or building an investment portfolio outside of super.
Getting a picture of your personal finances takes time, and time is often in short supply for business owners. The value of a financial adviser can be simply giving you extra time to focus on the business whilst your personal finances are taken care of. It is a bit like painting a house – something we could all probably do but we pay a professional to do it so we can spend our spare time doing the things we really enjoy.
Talking about spare time, lately we are finding more and more business owners spending time focusing on the needs of their elderly parents. Again, getting the right advice up front can save an enormous amount of time and lets you focus on the important, emotional issues that arise. The aged care rules are changing from 1 July this year, which could result in people paying significantly more for their aged care. If you are thinking about this then you should speak to your financial planner to find out how these changes may affect you or a loved one.
For further information contact Pitcher Partners on (02) 4911 2000, email or visit
Matt Matt Kerr
Matt Kerr is a Chartered Accountant and a Certified Financial Planner at Pitcher Partners Wealth Management. He has over 25 years assisting clients with their superannuation and personal finances.