Regardless of the type of business you own, your death will, without a doubt, bring about a lot of emotion and stress in you family and in your business.
Sometimes, the death of the family patriarch/matriarch business owner creates drama that will negatively impact your business, or even lead to its demise. Proper business succession planning can prevent drama from sinking the ship.
Here are ways to mitigate problems and fulfill a business owner’s wishes after they’re gone:
Buy-Sell Agreements. The business will, so-to-speak, is a buy-sell agreement. They let you choose how your business will be valued, how it will be distributed, and who will be able to take the baton after you’re gone. It may not prevent the emotion, but it will set forth a clear path for business succession and success.
Escrow and Trusts. If trust is lacking between your heirs, planning techniques can effectuate a stock trasfer without much issue. An escrow account or trust can hold your business interest until the terms of the transaction are met.
Pre-funding. If cashflow is tight when you pass, the original terms of the business succession can go up in flames. But, if the transfer is already funded, with life insurance or cash, the transaction is more likely to go forward. Term life insurance is commonly used for this purpose. That way there is no strain on cashflow to buy out your heirs.
Whichever mechanism you use, business succession planning is important to the overall successful transition of your business.
Author Bio
Paul Yokabitus
Founder & Estate Planning Lawyer
Paul Yokabitus is the founder of Cary Estate Planning, where he helps North Carolina families protect what matters most through wills, trusts, probate, and special needs planning. Known for his “planning, not paperwork” approach, Paul turns complex legal concepts into clear, practical strategies so clients feel informed and confident at every step. He has been recognized as a Business North Carolina Legal Elite attorney and a Super Lawyers Rising Star, and was named to the Triangle Business Journal’s 40 Under 40. A graduate of Campbell University School of Law, Paul lives in the Triangle with his wife, Alix, and their two sons.
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Paul and his team at Cary Estate Planning are fully committed to creating a personalized experience to develop thorough and comprehensive estate plans. They value their clients and go above and beyond to make sure that no details are missed. I would highly recommend Paul to anyone looking to create an estate plan.
I was referred to Paul by my Real Estate Attorney and I could not say enough about how exceptional the client service has been from everyone I spoke to. The communication is prompt and I feel like they really took the time to answer all my questions and set things up exactly as I wanted, but also recommended things to make it easier on my family down the line.
After attending one of Paul’s estate planning seminars, my husband and I knew we wanted Paul to assist us with our estate planning. His honest, professional approach to this necessary part of life put us at ease with the process. We will continue to recommend Paul and Cary Estate Planning.
We had a great experience working with Paul Yokabitus and the team at Cary Estate Planning to set up our Will and Estate Plan. The process was clear and easy, and in the age of COVID, our signing session was very well done, easy, and safe.
The Cary Estate Planning team will make sure that you have the information you need to be confident in your estate planning decisions. I learned so much from videos, a one-on-one in-person consultation, the website, emails, and a newsletter mailed the old fashioned way. The fee is very reasonable given the importance of estate planning. No matter the size or number of your assets, don’t procrastinate like I did!
Paul is a masterful attorney. He’s very good at taking your intentions and defining that into a durable Trust and Will. Best of all he is as simple and plain-spoken as you like. Or as fast as intellectual as you may be. It’s all about your your speed and your desired outcomes. Would strongly recommend this firm.
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