If you’re a small business owner, you may not have thought much about retirement. You may assume you’ll be able to sell the business and enjoy a comfortable retirement. However, if you don’t plan, you could end up working well into your old age and not getting much in return for all your hard work. The key is to plan and get expert advice to ensure you have a successful retirement.

Shifting from Small Business to Retirement: Quick Facts

1 – Map Out the Basics

You first need to figure out how much money you’ll need for retirement and then how much money you’ll have on hand when that time comes. This requires a good self-assessment of your life. Don’t forget to take all of your small business income into account. You’ll need to figure out how much you can expect to earn from your business in the future, so come up with a realistic, concrete plan for the future.

2 – Make Sure You Have an Emergency Fund

You may have the best retirement plan in the world, but you can still face unexpected financial burdens. An emergency fund can help you through a number of situations, like medical emergencies and other major problems. For instance, if you’ve been forced by an unexpected illness to stop working, you’ll be able to cover your expenses while you figure out what to do next.

3 – Evaluate Your Insurance Needs

It’s also important to evaluate your insurance needs. You’ll need to get coverage for life, health, disability and long-term care, along with any additional insurance you need. Life insurance is a must if you want to cover any outstanding debts and burial costs.

4 – Turn Your Business into Retirement Cash

If you want to sell the business to fund your retirement, you’ll probably want to make any necessary changes now. This could include supplementing your business with additional revenue streams, cutting out any unnecessary costs, or hiring knowledgeable employees to replace you.

5 – Plan for Budgetary Shortfalls

In addition to medical emergencies, you may also have to plan for budgetary shortfalls. For instance, if you’ve sold your business and no longer have an income, you may have to dip into your savings. Save enough money to cover your emergency needs and possible shortfalls.

6 – Get Financial Advice

If you’re not sure where to go with your future, get some advice from a financial planner. They can help you figure out your best course of action.

When you’re ready to leave your small business behind, you’ll need a solid plan to ensure you’re covered financially. As long as you have the proper financial preparedness, you should be able to retire with ease. An experienced financial planner can help you figure out what to do next.

Conclusion

A lot of small business owners are in denial about retiring. Moving from a small businessperson to an employee or retiree can be difficult. However, if you’re ready to move on and have a solid financial plan, it shouldn’t be too hard.

If you are looking for help with financial planning for retirement, come to Newcastle Financial Planning Group. We provide trusted financial advice for Newcastle and the Hunter.